Flows in the region are historically more correlated with gold's price behaviour and while much of the March volatility has receded, many of the same price drivers remain in place, including new ones such as questions over how the lower, or negative, rate environment, coupled with a quick uptick in inflation expectations, augurs for gold.

Also impacting demand is the continued social and economic uncertainty the COVID-19 pandemic leaves in its wake, including potential for a second wave of infections, and reduced future stock earnings expectations, driving valuations even higher supporting the argument to use gold as an effective portfolio hedge.

Meanwhile, most recently, race-related civil unrest in the US has added another layer of uncertainty in markets.

The region's funds led inflows for a second straight month, adding 102t (US$5.6 billion, 5.6% AUM) to 1,815t of gold, topping the previous highs of 1,736t they held in December 2012. European funds added 45t ($2.4 billion, 2.9%), led by UK-based funds, which accounted for 65% of the total in the region.

Asian funds, mainly in China, grew 4.7% or 4.4t ($262 million), and funds in other regions grew 4.3%, adding 2.6t and $136 million.

In all, gold ETFs added 154t for net inflows of $8.5 billion or 4.3% across all regions in May, boosting global holdings to a new record of 3,510t. Year-to-date, inflows (623t, $33.7bn) outpaces the highest level of annual inflows (591t) seen in 2009.

Total AUM rose to $195 billion even as stock and bond prices increased. Data shows global gold ETFs had inflows in all but two trading days during April and May (41 of 43 days). The only other historical period with similarly consistent inflows occurred in May and June of 2016, when funds experienced inflows in all but four trading days.