Bank of Korea Resumes Gold Investment with $250M ETF Purchase

The Bank of Korea has resumed gold investment after a 13-year hiatus, purchasing $250 million worth of shares in the SPDR Gold Shares ETF. The central bank acquired 679,765 shares of the world's largest physically backed gold ETF, which is classified as a security and included in foreign-exchange reserves.

The BOK plans to build a system to buy domestically refined gold and gradually increase the gold share of its foreign-exchange reserves. Choi Kyu-ho, an economist at Hanwha Investment & Securities, noted that the central bank's allocation to gold remains very low and has room for additional purchases.

The move comes as central banks around the world expand gold holdings to guard against geopolitical and economic uncertainty. The World Gold Council reported that central banks made net purchases of 289 tons of gold in the second quarter, the largest total ever for that period.