Bank of Korea Dives into Gold with $250 Million ETF Stake

The Bank of Korea has made its first foray into gold investment in 13 years by buying a $250 million stake in an overseas-listed gold ETF. The central bank added 679,765 shares of SPDR Gold Trust (GLD) as of the end of June, marking its first time investing in a gold-related ETF.

The move is seen as a significant development for South Korea's foreign exchange reserves, which could lead to an expansion into physical gold purchases. The Bank of Korea has also built a cooperative framework with domestic gold producers and exchanges to lay the groundwork for buying domestically produced gold.

The central bank's investment in gold ETFs is worth noting as it does not affect the gold-holdings ratio in foreign exchange reserve statistics, according to the report. The Bank of Korea also held significant stakes in other assets, including Vanguard S&P 500 ETF (VOO) and iShares Core S&P 500 ETF (IVV), which saw declines of 10.8% and 11.4%, respectively.