Escalating geopolitical risks surrounding North Korea's nuclear and ballistic missile programs have caused gold prices to soar in South Korea and led to a surge in trade in the precious metal, the local exchange said Sunday.
According to the Korea Exchange, a gram of gold changed hands at 47,210 won ($41.20) on Friday, the highest level since April 20, when speculation of a crisis on the peninsula swirled.
Last week alone, gold prices jumped 3.18 percent from the previous week, marking the first time since early July last year that the weekly increase rate has surpassed 3 percent.
The bourse operator also said the weekly trading volume of gold also reached an all-time high of 366 kilograms
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(Yonhap) |
Market watchers attributed the surge in gold prices to stronger investor appetite for safe-haven assets.
In contrast, South Korean stocks plunged last week, with its currency also tumbling against the US dollar.
The benchmark Korea Composite Stock Price Index dropped 3.16 percent last week from a week earlier, with the local currency plunging 18.40 won against the greenback for the past three sessions.
Investors have been rattled by escalating tensions on the Korean Peninsula, sparked by North Korea's two intercontinental ballistic missile launches in July.
In a bitter war of words, US President Donald Trump has threatened the North with "fire and fury." Pyongyang has pushed back, saying it will fire four missiles near the US territory of Guam in the Pacific.
"In light of gold prices and other indicators, it is clear that flight to safety has strengthened," said Lee Kyung-min, a senior analyst at Daeshin Investment & Securities Co. "Stocks and other risky assets are expected to suffer volatility until the end of the third quarter." (Yonhap)
