Gold Prices Surge, Heightened Expectations for Safe Haven
Gold prices have surged approximately 50% this year, exceeding $3,800 per troy ounce—the largest gain since the oil shock of the 1970s. This increase is primarily driven by the weakened dollar due to President Trump's trade war and inflation concerns, encouraging safety asset preferences towards gold. Consequently, there has been a significant influx of funds into gold ETFs, with $13.6 billion flowing in over the past four weeks alone, raising the gold reserves in these ETFs to over 3,800 tons.
Morgan Stanley is now re-positioning gold as a core asset in portfolios, proposing a new asset allocation model of '60% equities, 20% bonds, 20% gold'. The prolonged US government shutdown has further pushed gold prices to nearly $4,000 per ounce, achieving an all-time high. As a result, investor interest in gold has sharply increased, driven by economic and geopolitical uncertainties and expectations of Federal Reserve rate cuts.
In Korea, the domestic gold price has exceeded 200,000 won for the first time, signaling expanding investment enthusiasm. This uptick is attributed to rising US government debt, geopolitical instability, and robust fund inflows via ETFs. Long-term projections suggest continued gold price increases due to declining central bank gold reserves and rising exploration costs. However, in the short term, increased liquidity following interest rate cuts could limit gold's performance.
In Korea, primary gold investment avenues include gold bars, gold accounts, the KRX Gold Market, and gold ETFs. In terms of fees and taxes, the KRX Gold Market and gold ETFs are notably efficient. Experts advise considering overseas gold ETFs during a
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