The Bank of Korea (BOK) is considering resuming gold purchases for the first time in over 12 years, marking a potential shift in its reserve management strategy amid persistent inflation and currency volatility. Heung-Soon Jung, head of the BOK's Reserve Investment Division, announced that gold is under review as a medium- to long-term consideration for the country's foreign reserves, emphasizing careful assessment of exchange rate conditions and the global gold market before any decision.
The BOK last added to its gold holdings between 2011 and 2013, purchasing a total of 90 tons—40 tons in 2011, 30 tons in 2012, and 20 tons in 2013—but faced domestic criticism as gold prices entered a prolonged slump shortly after. Currently, the bank holds 104.4 tons of gold, ranking 41st globally. This renewed interest comes as South Korea grapples with stubbornly high inflation and sustained pressure on the Korean won against the U.S. dollar.
In a contrasting move, Brazil has proposed allocating approximately $19 billion, or 5% of its reserves, toward purchasing Bitcoin as part of a diversification strategy to reduce reliance on the U.S. dollar and assert monetary sovereignty. This plan, hailed as forward-looking, underscores a broader trend of central banks exploring alternative assets.
Gold prices have been highly volatile, reaching a record high of $4,381 per ounce earlier in October before plunging by roughly 11.57% to below $4,000—the first time since 2013. The decline included a 6% one-day drop, the worst in 12 years, erasing around $2.1 trillion in market value. Despite this, experts like Steve Hanke and Peter Schiff remain optimistic, forecasting a potential bull market peak of $6,000 per ounce and viewing the sell-off as a buying opportunity.
Globally, central banks are accelerating gold accumulation, with 23 countries increasing holdings in the first half of 2025—including Poland (18.66 tonnes), Kazakhstan (15.65 tonnes), and China (6.22 tonnes)—and expected to buy 900 tonnes this year. This shift reflects eroding confidence in dollar-denominated assets amid U.S. fiscal deficits and trade tensions.
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