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State Street Gold Fund Commentary Q1 2025 Update

In Q1 2025, the State Street Gold Fund returned +18.23% (net), underperforming the benchmark by 0.39%.¹ Following on the gold price in AUD gaining 40% in 2024, the yellow metal continued to find strong momentum led by global investors piling into gold on the back of surging market volatility and economic uncertainty. Rising inflation expectations, slower global potential growth, and heightened geopolitical tensions have supported the ongoing strength in the gold market. Since the State Street Gold Fund’s inception in July 2024, it has returned +41.41%, outperforming the benchmark by 0.04%.²

09 April 2025

Robin Tsui, CPA, CAIA, CA

APAC Gold Strategist

Gold Market Review and Outlook

The gold price in AUD again performed strongly in Q1, rising from A$4,241/oz to A$5,000/oz (+17.9%), and recorded its 6th consecutive quarterly gains as well as capping its best quarterly performance since Q1 2020. Gold continued to hit record highs, driven by escalating geopolitical tensions and weakness in the equity markets, negatively impacted by the growing concerns of a global trade war. In Q1, US (S&P 500 total return) and Australian large cap (ASX 200 total return) equities were down 5.1% and 2.8%, respectively.

Investor demand for gold remained exceptionally robust, with global investors pouring US$21.1 billion into gold-backed ETFs in Q1, the most since Q2 2020. Faced with structural issues such as slower economic growth, geopolitical tensions, weak local equity markets, and local currency depreciation, the APAC region also started 2025 strongly, with APAC investors lured by its diversification and haven benefits as well as its capital appreciation potential. In Q1, APAC locally domiciled gold-backed ETFs posted net inflows of U$3.6 billion³, led by inflows from China (+US$2.3 billion), India (+US$610 million) and Japan (+US$417 million). We also saw the return of strong inflows in Australia (+US$254 million), helped by the Reserve Bank of Australia (RBA)’s first rate cut since 2020 in February. Heading into Q2, we believe the backdrop for gold investment remains favorable for global and APAC investors, supported by both positive price momentum and structural growth drivers.

Central bank, led by emerging market central banks, continued to accumulate gold during the first two months of the year. China and India have been the driving forces behind central bank net purchases so far in 2025 with the People’s Bank of China (PBOC) and the Reserve Bank of India (RBI) adding 10.0 and 2.8 tonnes³ of gold. With India and China currently holding 12.4% and 5.9% of gold in its FX reserves, we think there is more room for the PBOC and RBI to further accumulate gold as part of their ongoing FX reserve management.

We recently increased our 2025 base case gold outlook to US$2,800 to US$3,100 (from US$2,600 to US$2,900) amid a strong Q1 price rally and robust ETF inflows. We also lifted our bull case range to US$3,100-US$3,400 (from US$2,900 to US$3,100) and increased the bear case to US$2,500 to US$2,800/oz (from US$2,200 to US$2,600). Supported by ongoing geopolitical tensions, strong investor demand globally, robust central bank buying and fears over US tariffs’ risking a global trade war, we continue to be bullish on the market outlook for gold.

Footnotes

Disclosure

Issued by State Street Global Advisors, Australia Services Limited (AFSL Number 74900, ABN 16 108 671 441) (“SSGA, ASL”). Registered office: Level 14, 420 George Street, Sydney, NSW 2000, Australia. T: 612 9240 7600. State Street Global Advisors, Australia, Limited (AFSL Number 238276, ABN 42 003 914 225) (“SSGA Australia”) is the Investment Manager.

References to the State Street Gold Fund ("the Fund") in this communication are references to the managed investment scheme domiciled in Australia, promoted by SSGA Australia, in respect of which SSGA, ASL is the Responsible Entity. This general information has been prepared without taking into account your individual objectives, financial situation or needs and you should consider whether it is appropriate for you. You should seek professional advice and consider the product disclosure statement, available at www.ssga.com, before deciding whether to acquire or continue to hold units in the Funds. The Target Market Determination is also available at ssga.com., before deciding whether to acquire or continue to hold units in the Fund. The Target Market Determination is also available at ssga.com.

Investing involves risk including the risk of loss of principal. Diversification does not ensure a profit or guarantee against loss. Investing in commodities entail significant risk and is not appropriate for all investors. There are risks associated with investing in Real Assets and the Real Assets sector, including real estate, precious metals and natural resources. Investments can be significantly affected by events relating to these industries.

THE LBMA GOLD PRICE, WHICH IS ADMINISTERED AND PUBLISHED BY ICE BENCHMARK ADMINISTRATION LIMITED (IBA), SERVES AS, OR AS PART OF, AN INPUT OR UNDERLYING REFERENCE FOR THE STATE STREET GOLD FUND.

LBMA GOLD PRICE IS A TRADE MARK OF PRECIOUS METALS PRICES LIMITED, AND IS LICENSED TO IBA AS THE ADMINISTRATOR OF THE LBMA GOLD PRICE. ICE BENCHMARK ADMINSTRATION IS A TRADE MARK OF IBA AND/OR ITS AFFILIATES. THE LBMA GOLD PRICE PM, AND THE TRADE MARKS LBMA GOLD PRICE AND ICE BENCHMARK ADMINISTRATION, ARE USED BY STATE STREET GLOBAL ADVISORS WITH PERMISSION UNDER LICENCE BY IBA.

IBA AND ITS AFFILIATES MAKE NO CLAIM, PREDICATION, WARRANTY OR REPRESENTATION WHATSOEVER, EXPRESS OR IMPLIED, AS TO THE RESULTS TO BE OBTAINED FROM ANY USE OF THE LBMA GOLD PRICE, OR THE APPROPRIATENESS OR SUITABILITY OF THE LBMA GOLD PRICE FOR ANY PARTICULAR PURPOSE TO WHICH IT MIGHT BE PUT, INCLUDING WITH RESPECT TO THE STATE STREET GOLD FUND. TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ALL IMPLIED TERMS, CONDITIONS AND WARRANTIES, INCLUDING, WITHOUT LIMITATION, AS TO QUALITY, MERCHANTABILITY, FITNESS FOR PURPOSE, TITLE OR NON-INFRINGEMENT, IN RELATION TO THE LBMA GOLD PRICE, ARE HEREBY EXCLUDED AND NONE OF IBA OR ANY OF ITS AFFILIATES WILL BE LIABLE IN CONTRACT OR TORT (INCLUDING NEGLIGENCE), FOR BREACH OF STATUTORY DUTY OR NUISANCE, FOR MISREPRESENTATION, OR UNDER ANTITRUST LAWS OR OTHERWISE, IN RESPECT OF ANY INACCURACIES, ERRORS, OMISSIONS, DELAYS, FAILURES, CESSATIONS OR CHANGES (MATERIAL OR OTHERWISE) IN THE LBMA GOLD PRICE, OR FOR ANY DAMAGE, EXPENSE OR OTHER LOSS (WHETHER DIRECT OR INDIRECT) YOU MAY SUFFER ARISING OUT OF OR IN CONNECTION WITH THE LBMA GOLD PRICE OR ANY RELIANCE YOU MAY PLACE UPON IT.

This material should not be considered a solicitation to apply for interests in the Fund and investors should obtain independent financial and other professional advice before making investment decisions. There is no representation or warranty as to the current or accuracy of, nor liability for, decisions based on such information.

The whole or any part of this work may not be reproduced, copied or transmitted or any of its contents disclosed to third parties without SSGA Australia’s express written consent.

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