Futures Market News
South Korea to open bullion market by 2012
Dec 14, 2010 03:32 PM
South Korea, a country that holds keen interest in gold but has no organized equities and future markets operator for the precious metal, confirmed it will open one in 2012, Bloomberg reports.
Kim In Soo, an administrator at the Korea Exchange, said demand is high and will only intensify, necessitating the opening of a spot market for bullion.
"We expect mini-gold trading to increase through next year as there is a plenty of investor interest," he told Bloomberg.
The chief executive officer of the World Gold Council last week told CNBC that Asian gold demand is "very strong". Aram Shishmanian also said that demand is fueled by purchases of jewelry and regional economic growth. Consequently, Asian growth is definitely impacting the gold market, he said.
Soo said Koreans perceive the precious metal as a secure investment. While Korea remains one of the largest foreign holders of U.S. dollar assets, the recent shakiness of the greenback and the prospect of quantitative easing has some investors reconsidering those allocations. Gold presents an attractive alternative.
"Koreans have more interest in gold than other commodities, regarding it as an investment tool," Soo told Bloomberg.
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