Global Asset Managers Boost Gold Exposure Amid Geopolitical Risks
Global asset management giants are rebuilding their gold positions, despite concerns over prolonged Federal Reserve tightening. Amundi, Europe's largest asset manager, is among those increasing their gold exposure, with fund managers predicting that gold prices will recover to around $5,000 per ounce by year-end.
The Bank of Korea has also joined the trend, purchasing a gold ETF for the first time in 13 years. The central bank added SPDR Gold Trust (GLD) to its portfolio in the second quarter, marking a shift towards diversifying dollar-centric foreign reserves and hedging against geopolitical risks.
Experts note that global institutions are buying gold during this price correction, signaling that they view structural demand drivers such as geopolitical risk and foreign reserve diversification as more significant than short-term interest rate variables. While the potential for short-term volatility remains, central banks' efforts to diversify their reserves are strengthening gold demand.