The five major commercial banks of South Korea saw their monthly gold bar sales surpass 100-billion-won (about 70-million U.S.-dollar) threshold for the first time in September, signaling a surge in public interest in the precious metal, as global gold prices continue to soar.
International gold prices have extended their strong upward momentum since September. The prices of spot gold have risen more than 50 percent so far this year, making it one of the best-performing major assets globally. Gold futures for December delivery on the New York Mercantile Exchange briefly broke through the psychological threshold of 4,000 U.S. dollars per ounce on Monday evening local time, the first time in history.
The five leading banks in South Korea sold 111.6 billion won (about 78 million U.S. dollars) worth of gold bars in September, a 198-percent increase from the previous month, according to data released on Monday.
Cumulatively, gold bar sales have reached 437 billion won (about 310 million U.S. dollars) in the country so far this year, marking an all-time record.
On Oct 1, gold traded on the Korea Exchange broke 200,000 won (about 140 U.S. dollars) per gram for the first time. Within a single week starting on Sept 24, South Korean gold prices surged 14 percent, more than four times the global rate of increase. By the end of September, the domestic premium over international prices reached nearly 12 percent.
Market observers say they generally believe that the surge in gold prices reflects a combination of multiple factors -- rising economic uncertainty linked to U.S. tariffs, heightened U.S. fiscal uncertainty, and the ongoing partial U.S. government shutdown and delays in the release of key economic data -- which have left markets without clear guidance on the economic outlook. While the U.S. dollar has weakened globally, the South Korean won has depreciated even more sharply against the dollar, prompting local investors to shift their assets toward gold.
Soaring prices also reshape consumer habits in the country. Many South Korean young couples are opting out of traditional gold wedding rings and parents now prefer cheaper rings to honor their babies' one-year-old birthday instead of a traditional gold ring.
Soaring prices fuel gold frenzy in South Korea
Soaring prices fuel gold frenzy in South Korea
