As the war in the Middle East intensifies and economic uncertainty both at home and abroad increases, the prices of gold, which is considered a safe asset, as well as silver, are rising. Amid an increase in investments in bank gold banking and gold bars, there is a significant influx of investment funds into silver, which has recorded its highest price in 13 years.
On the 17th, the international gold price traded at $3,422 per troy ounce (31.1g) on the New York Mercantile Exchange. The previous day, it had risen to $3,473.45. This is approaching the peak recorded on April 22, $3,509.9. Silver prices also showed a strong upward trend. The international silver price reached the $36.5 range on that day. On the 9th, it rose to $37.03, marking the highest price since February 2012 ($37.13).
As gold and silver prices have surged by 30.1% and 23.8%, respectively, this year, substantial amounts of money are flowing into related investment products. The five major banks—KB Kookmin, Shinhan, Hana, Woori, and NH Nonghyup—reported that they sold gold bars worth 225.6 billion won from the beginning of this year until last month. This is double the annual sales amount from last year (120.3 billion won).
Funds are continuously flowing into bank 'gold banking', where one can easily buy and sell gold in 0.01g units through bank accounts. As of the end of last month, the gold banking balance of KB Kookmin, Shinhan, and Hana Banks was 1.016 trillion won. The gold banking balance maintained between 500 billion and 600 billion won from 2023 until the first half of last year, but it surpassed 1 trillion won for the first time in March.
Investments in silver bars and silver banking are also on the rise. The four major banks, excluding Hana Bank, sold silver bars worth 1.836 billion won from the beginning of this year until last month. Despite a halt in sales in March, with only some banks resuming supply in April, the sales reached three times the annual sales amount from last year (630 million won). A banking official noted, "Demand increased further after the resumption of silver bar sales earlier last month, and it seems that investors perceive it as having less price burden compared to gold and greater potential for price increases." Among commercial banks, only Shinhan Bank is currently selling silver banking, with the account balance increasing by approximately 40% from 44.5 billion won at the end of last year to 62.7 billion won as of the 12th of this month.
Experts generally expect that gold prices will continue to trend upward in the long term. Rather than aiming for short-term profits by increasing the investment ratio, they recommend a 'long-term and diversified investment' strategy at about 5 to 10% of the investment portfolio. Park Tae-hyung, branch manager of the TCE Signature Center at Woori Bank, said, "The U.S. investment bank JP Morgan recently projected that international gold prices will surpass $6,000 per ounce by 2029," adding, "Even this year, it is expected to set a new peak in the second half." Park stated, "However, it would be advantageous from a stability standpoint to maintain an investment ratio around 5 to 10% rather than keeping it high."