South Korea's central bank to buy gold from domestic producers

The Bank of Korea announced it will begin purchasing gold from local producers, a move designed to diversify its supply sources and bolster its holdings of the precious metal. This initiative establishes a new framework for domestic gold acquisition, involving key financial institutions like the Korea Exchange (KRX) and the Korea Securities Depository (KSD).

Under the new framework, the central bank will acquire gold from domestic producers at prevailing international market prices. The transactions, payments, and deposits will be managed through the existing systems of KRX and KSD. The bank indicated that these purchases are expected to have a minimal impact on domestic gold trading prices, as the gold acquired will be intended for export and purchased at contract prices.

These domestic purchases represent a significant shift, marking the central bank's first such acquisitions in 13 years, according to local media reports. The initiative is part of the bank's strategy to enhance its management of foreign reserves.