South Korea Finally Shifts to Physical Gold Reserves

South Korea's central bank is finally set to expand its gold reserves with physical metal.

In August, the Bank of Korea announced plans to increase its gold holdings, but so far it has only purchased paper gold through a gold-backed ETF.

The ETF purchase was valued at ₩354.5 billion ($250.41 million) by the end of June and consisted of 679,765 shares of the SPDR Gold Trust ETF.

A Bank of Korea official stated that a transaction system to buy physical gold from local producers will be operational by December 14.

The central bank plans to purchase about 1 tonne of gold when market conditions are favorable and at contract prices. The gold will reportedly be stored in South Korea, with most of the country's current reserves held in London vaults.