July 20, 2020 13:42
The coronavirus epidemic has driven more and more investors to gold as a safe-haven investment as businesses are in deep trouble.
The price of 1 g of gold on the Korea Exchange last Wednesday closed at a record W70,000, (US$1=W1,205). The previous record was set in March of 2014.
One staffer in a jewelry shop in Jongno said, "Newly-wed couples show a growing interest in gold after being distracted by luxury jewelry brands for some time. They're not buying rings but bullion."
One newly-wed couple in their 30s who bought W8 million worth of gold bars or 90 g in February instead of a pair of wedding rings, said, "We're not going to wear our rings every day and feel it would be better to buy gold bars that we can resell later."
Millennials are spearheading the trend. The KRX analyzed Korea's top five gold traders in late March and found that 38.5 percent of their investors were in their 30s and 17.6 percent in their 20s. People in their 40s accounted for only 28.8 percent, those in their 50s for 11.5 percent and those over 60 for a mere 3.6 percent.
"Young people who have usually bought stocks are viewing gold as an investment," the KRX said.
Trading volume is soaring. The average daily trading amount of gold on the KRX from January to June reached W5.78 billion, up a whopping 139.8 percent on-year.
The cumulative trading amount in the first six months totaled W710.3 billion, already surpassing the amount for the whole of last year. The KRX forecasts the amount to surpass W1 trillion this year for the first time ever.
Others are selling their gold to make ends meet. Jewelry shops are racing each other to lure sellers, and some are even making house calls to buy gold.
This fervor has led some to crime. One mortician in Busan was sentenced to 10 months in prison early this month after being caught pulling the gold teeth out of a corpse. He said he did it because his monthly income shrank to just W1 million due to the coronavirus epidemic.
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