Korea Minting and Security Printing Corp. Halts Gold Bar Sales Amid Hoarding Concerns
With international gold prices soaring, Korea Minting, Security Printing & ID Card Operating Corp. (KOMSCO) has decided to suspend gold bar sales. The surge in demand for gold as a safe-haven asset amid the expanding U.S.-led trade war has driven the decision, and KOMSCO has stated that it cannot predict when sales will resume.
According to financial industry sources on Feb. 11, KOMSCO has sent an official notice to commercial banks requesting the suspension of gold bar sales. A company official explained, “With gold prices skyrocketing, we are unable to secure gold raw materials, leading to the suspension of gold bar sales. We do not know when we will be able to resume sales.”
International gold prices have continued to climb. According to Reuters, the spot price of gold surged to $2,911.30 per troy ounce on Feb. 10 (local time), setting a new yearly high for the seventh time this year. Gold prices, which jumped 27 percent last year ahead of Donald Trump’s return to the White House, have maintained an upward trend this year. As of this date, gold has risen by 11 percent this year.
Wall Street analysts predict that gold breaking the $3,000 mark is only a matter of time. Some market observers expect that prices could reach $4,000 next year as central banks worldwide continue to accumulate gold amid trade war uncertainties. Analysts at Citigroup noted in a memo on Feb. 7, “Gold bullion is being purchased as a hedge against downside risks posed by tariffs on U.S. and global economic growth as well as stock markets,” projecting that gold prices could reach $3,000 per ounce in the short term.
Gold has emerged as a top-performing investment asset, with prices soaring approximately 44 percent over the past year, delivering the highest returns among 12 major asset classes.
This surge in gold prices has also led to a sharp increase in domestic gold banking accounts. As of Feb. 10, the number of gold banking accounts at KB Kookmin, Shinhan, and Woori Bank reached 277,551, marking a 10 percent increase from a year ago. The total balance in gold banking accounts rose by 53.1 billion won(approximately $36.55 million) in a single month, reaching 835.3 billion won last month.
Even before the suspension, gold bar sales through major banks were skyrocketing. Last month, gold bar sales at commercial banks, including KB Kookmin, Shinhan, and Woori Bank, surged to 22.5 billion won, and this month alone, 16.8 billion won worth of gold bars have been sold, reflecting soaring demand for gold. In December last year, sales stood at 14.2 billion won. A financial industry official noted, “Some funds are shifting from traditional savings and deposits to gold investments,” adding, “As gold is classified as a safe-haven asset, it is drawing strong interest from investors.”
Even before the suspension, gold bar sales at major banks were skyrocketing. Last month, commercial banks – including KB Kookmin, Shinhan, and Woori – collectively recorded 22.5 billion won in gold bar sales. In just the first half of this month, sales reached 16.8 billion won, reflecting the surging demand for gold. In December last year, sales totaled 14.2 billion won. A financial industry official noted, “Some funds are shifting from traditional savings and deposits to gold investments,” adding, “As gold is considered a safe-haven asset, it is attracting strong interest from investors.”
Source: https://www.businesskorea.co.kr/