Money managers and other large speculators are bailing as the rally that took futures to its best first half in almost four decades falters. They cut net-long positions the past two weeks by the most in data going back a decade. Investors in ETFs are taking the long view, pouring $605 million over the past week into funds backed by precious metals and helping keep holdings in gold ETFs tracked by Bloomberg at the highest since 2013.

Gold futures have fallen almost 5 per cent since the end of June as speculation that US interest rates will soon rise curbs the appeal of precious metals, which don’t pay interest. The tug-of-war between money managers and ETF investors reflects differing views on whether global economic and political turmoil will eventually reignite demand for gold as a haven asset, said Naeem Aslam, chief market analyst at ThinkMarkets U.K.

“The move in the market is somewhat due to the ongoing difference between the ETF holders and money managers,” Aslam said in an email. ETF investors “are taking a much wider view of the economy,” undeterred by short-term trends, he said.

Gold futures for December delivery gained less than 0.1 per cent to settle at $1,256.60 an ounce at 1:39pm on the Comex in New York, after posting a 0.3 per cent gain last week.

Money managers cut their net-long positions by about 108,000 contracts in the two weeks through October 11, the biggest such decline in data going to 2006, according to US Commodity Futures Trading Commission data released Friday.

In the US, where Federal Reserve officials are monitoring signs of economic resilience before raising rates, output at manufacturers rose for the third time in four months on production of goods and construction materials. Traders are pricing a 67 per cent chance that the Fed will raise rates by December, up from 55 per cent a month earlier.

On Saturday, Boston Fed President Eric Rosengren said the US central bank is already running the economy hot enough to overshoot his estimate for the lowest sustainable level of unemployment and to reach its goal for 2 per cent inflation. A day earlier, Fed Chair Janet Yellen said there are ways that running the economy hot could fix damage caused by the Great Recession, laying out the argument for keeping policy easy without taking a hike off the table this year.

In other precious metals, silver futures gained 0.2 per cent on the Comex in New York, while palladium and platinum futures slipped on the New York Mercantile Exchange.