Bank Customers Rush to Buy Gold Amid Economic Concerns Over Rates and Trump Policies
Bank customers in South Korea are flocking to buy gold amid dashed expectations for early interest rate cuts by the Federal Reserve (Fed) and growing concerns over the policies of US President Donald Trump, according to recent industry data.
Seoul: Bank customers in South Korea are flocking to buy gold amid dashed expectations for early interest rate cuts by the Federal Reserve (Fed) and growing concerns over the policies of US President Donald Trump, according to recent industry data.
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Surge in Gold Sales by South Korean Banks
According to the data, South Korea’s top five banks—KB Kookmin, Shinhan, Hana, Woori, and NH Nonghyup—have sold a combined 24.2 billion won ($16.7 million) worth of gold bars this month. This figure represents a significant increase from 7.96 billion won during the same period last year. The rise is even sharper compared to 12.4 billion won in gold sales recorded last month, highlighting the growing demand.
Gold as a Safe Haven Amid Economic Uncertainty
The uncertain economic outlook, driven by a lack of anticipated interest rate cuts from the Federal Reserve and increased volatility from US President Trump’s trade policies, has led South Korean bank customers to seek out safer assets, particularly gold.
As of Tuesday, the price of 1 gram of gold was 156,230 won, marking the highest price since March 2014 when South Korea’s gold exchange was first launched. This price is nearly double the value of 86,000 won per gram recorded on February 13 of last year.
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Record Gold Trading Volume in South Korea
The daily trading volume of gold in South Korea reached 102 billion won on Tuesday, surpassing the 100 billion-won threshold for the first time. This surge in trading reflects the heightened demand for the precious metal as a hedge against uncertainty.
South Korean Stock Market Shows Gains Despite Global Tensions
Meanwhile, South Korean stocks closed higher on Wednesday, with gains in the tech sector and shipbuilders driving the market upwards. The local currency, however, weakened against the US dollar. The Korea Composite Stock Price Index (KOSPI) rose by 9.34 points, or 0.37%, closing at 2,548.39. This marks the second consecutive session of gains for the index.
Looking Ahead: US Inflation Data in Focus
Investors are also closely monitoring US inflation data for January, which was scheduled for release on Wednesday (US time), as it could offer further insight into the economic direction and potential Fed actions.
