Japan's retail gold prices top 10,000 yen per gram for 1st time

Tue Aug 29 2023

Retail prices of gold in Japan exceeded 10,000 yen ($68.31) per gram for the first time on Tuesday, according to precious metal trader Tanaka Kikinzoku Kogyo.

The metal sold for 10,001 yen per gram on the day -- up 28 yen from the previous day -- setting a new high, the trader said.

Yen-denominated prices of gold have been rising on the currency's depreciation against the dollar amid increasing demand for the metal as a safe asset out of concern about a slowing world economy.

The yen continued to weaken against the dollar in New York on Monday, closing at the mid-146 level. With U.S. Federal Reserve Chair Jerome Powell indicating last Friday that the central bank will maintain its tight grip on credit, investors continue to buy the dollar against the yen in expectation of a widening gap between interest rates in Japan and the U.S.

While dollar-denominated international prices of gold remain high, the accelerating depreciation of the Japanese currency is pushing up domestic gold prices in Japan.

Gold is seen as a safe asset, given its rare availability and high value as a physical asset. Investors are flocking to the gold market because sharp interest rate hikes in the U.S. have increased wariness about the world economy. Moves for risk avoidance are also gathering steam amid increasing concern about China's economic outlook.

Source: https://asia.nikkei.com/