Collective ETF holdings reached an all-time high of 2900t in the fourth quarter as global gold-backed assets under management (AUM) surged by 37% in dollar terms during the year as a result of strong demand from US and EU markets, combined with an 18.4% increase in the gold price.

North American funds led regional inflows adding 206t ($10.1 billion, 14.4% AUM) as growing geopolitical tensions and the first Federal Reserve rate cuts in a decade fuelled market uncertainty.

The WGC said low-cost gold-backed ETFs in the US had seen positive flows for 18 of the past 19 months and increased collective holdings by 60%.

Holdings in European funds increased by 188t ($8.8 billion, 13.6%), while funds listed in Asia were nearly flat, losing 0.1t ($12 million, 0.3%).

All other regions had combined inflows of 6.3t ($311 million, 16.3%).

The WGC expects many of gold's 2019 geopolitical, market and economic drivers to continue into 2020, with a broad shift in monetary policies from a hawkish or neutral stance to a dovish one historically boding gold to outperform.

While expectations for future US Fed interest rate cuts have fallen, continued Fed intervention in the repo market has led some to consider this a form of quantitative easing through liquidity injection. Geopolitical tensions across the globe such as a US-China trade deal and the Brexit saga remain to be resolved, adding to global economic uncertainty.

Meanwhile, multiple expansion in the global stock markets, as well as "surprisingly" low yields in speculative corporate debt, continued to worry investors, the WGC said.

"A willingness to add risk, as stock market sentiment remains at extremely bullish levels, is evidenced by VIX futures levels near all-time short levels. At times, historically, significant VIX short positioning has preceded sharp stock market selloffs and subsequent rallies in the gold price."

The gold price scaled an eight-year high on Tuesday at $1613/oz after Iran attacked military bases in Iraq housing US troops in retaliation for the US assassination of the head of Iran's elite Quds Force, major-general Qassem Soleimani.