Gold draws renewed interest as Korean stocks tumble after US midterms
Gold investment has drawn renewed interest in Korea as international bullion prices rebound while domestic stocks sold off sharply following the Democrats’ capture of both chambers of Congress in the U.S. midterm elections. The election outcome raised expectations that Congress could curb President Donald Trump’s plans to expand fiscal spending, putting downward pressure on U.S. Treasury yields…
Gold investment has recently captured the attention of Korean investors amidst a dramatic decline in domestic stocks following the Democrats' triumph in the U.S. midterm elections. The electoral results raised concerns that Congress may limit President Trump's strategy of increasing fiscal spending, leading to a drop in U.S. Treasury yields and the value of the dollar.
As interest rates decrease, gold becomes more appealing since it does not offer any returns, and its price becomes more affordable for buyers from other currencies.
On Friday, the domestic spot price of gold in Korea reached 176,690 won ($130) per gram, according to the Korea Exchange. While this price is slightly lower than the previous trading day, it is still 4.53 percent higher than the level observed on November 2. The slight decrease in gold prices occurred after a 2.64 percent increase on Thursday, when the metal closed at 178,460 won per gram, marking a 5.58 percent rise from November 2.
In contrast, South Korea's two major stock indices, the KOSPI and Kosdaq, experienced steep declines of 6.02 percent and 5.03 percent, respectively, on Friday. These losses were an extension of the 5.28 percent and 5.11 percent drops experienced on Thursday. Moreover, retail prices of gold in Korea also rose, with a traditional don of pure gold experiencing a price increase.
Written by urgent.news from The Korea Times's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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