Daily trading value of 360 billion won…Gold market gripped by madness

More than LG Energy Solution, the third-largest by market cap

KRX gold spot, up 63% this year

Kimchi premium also reaches 15%

As global geopolitical uncertainty continues, gold prices, regarded as the 'king of safe-haven assets', have been rising sharply day after day. Experts generally assess that it will not calm down easily for the time being.

Daily trading value of 360 billion won…Gold market gripped by madness

On the 14th, according to the Korea Exchange (KRX) gold market, the spot price of gold per 1g closed at 219,900 won, up 4.88% from the previous day. It was the highest for three consecutive trading days. Trading value totaled 362 billion won, approaching the record high (377 billion won) set on the 1st.

The global market is the same. On the 13th (local time) at the New York Commodity Exchange (COMEX), the December gold futures price rose 3.3% in a day to $4,133 per troy ounce. Year to date, gold prices are up 63.3% on the KRX gold market and 58.7% on the COMEX futures market. These are among the top returns among major asset classes.

Trading value continues to increase. According to Korea Exchange statistics, the average daily trading value of gold spot this month is 322 billion won. In the same period, based on the securities market, it was the fifth most traded after Samsung Electronics, SK Hynix, Doosan Enerbility, and Naver. It is a larger trading volume than LG Energy Solution, the third-largest company by market capitalization in Korea (average daily trading value of 178 billion won).

The 'kimchi premium', which denotes the price divergence with the global market, continues to rise. The price difference between the KRX gold market and COMEX spot, reflecting the exchange rate, was 15.65% based on the close that day, the highest since the KRX gold market opened in 2014.

Experts said that due to a temporary U.S. federal government shutdown and the intensifying U.S.-China trade dispute, gold has effectively monopolized the status of a safe-haven asset. They noted that the dollar, another safe-haven asset, cannot be broadly regarded as strong. The dollar index, which shows the dollar's value against the currencies of six major countries such as the euro and yen, is only in the low 99s.

Yun Yeo-sam, a researcher at Meritz Securities, explained, "Even though U.S. ultra-long-term interest rates are high in the 4% range, concerns about rising prices persist and the attractiveness of bond investment has faded," adding, "The appeal of gold, a non-yielding asset, has become much greater than that of other safe-haven assets such as the dollar and bonds." He forecasted, "Gold prices will only stabilize after the spread between long- and short-term U.S. Treasury yields narrows and a slowdown in inflation is confirmed."

Reporter Jeon Beom-jin forward@hankyung.com