The Korea Exchange announced on the 15th that the trading value of the gold market in the first half of this year increased by 40% compared to the previous year. In particular, individual investors accounted for the highest proportion of transactions.
The trading volume of the Korea Exchange gold market rose from 7,786 kilograms (kg) in June last year to 8,962 kilograms last month, an increase of 15%. During the same period, the trading value increased by 40%, from 628.3 billion won to 879.3 billion won.
The gold price rose 20%, from 86,340 won per gram (g) at the end of last year to 103,410 won at the end of last month.
The price deviation rate was around 100.3% of the international price, supported by market participation and expansion by liquidity providers (LPs). By investor type, individuals accounted for the largest share at 42.9%, followed by institutions at 39.7%, and physical traders at 15.7%.
Meanwhile, the average daily gold prices in the first half of the year at the Shanghai Gold Exchange and the Istanbul Exchange, the world's largest on-exchange spot trading markets, rose 20% and 14% respectively compared to the previous year. The average daily trading volume increased by 38% at the Shanghai Gold Exchange but decreased by 59% at the Istanbul Exchange.
The exchange analyzed that the upward trend in the gold market was driven by expectations of interest rate cuts by the U.S. Federal Reserve (Fed) and increased gold demand due to rising geopolitical risks.
It also explained that amid intensifying global conflicts and concerns over economic recession, some economic agents are increasing their gold holdings, diversifying their assets by raising gold reserves to reduce dependence on the U.S. dollar, especially in emerging countries such as China and Russia.
An official from the exchange said, "The demand for gold, a major safe-haven asset, has increased due to the growing preference for safe assets amid expanding global economic uncertainties. The KRX Gold Market allows convenient trading through securities firms and guarantees the stability of physical gold, establishing itself as a key investment destination."
He added, "The KRX Gold Market price is a fair price formed in the market, allowing small investments in units of one gram, with low transaction costs and tax benefits enabling reasonable investment. The KRX Gold Market is promoting diverse marketing activities such as joint marketing with securities firms and participation in economic expos, and plans to expand investor-targeted promotions and lectures to encourage participation from a wide range of market participants."
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
