The Bank of Korea (BoK) recently executed a second consecutive 25 basis point rate hike, raising the rate to 3.0%. This move has supported the South Korean won, which has seen significant appreciation since June. BoK's tightening stance has helped bolster the currency against the US dollar.
How does this relate to the gold market? When central banks like the BoK tighten monetary policy, it can influence currency rates and subsequently affect gold prices. Gold is a globally traded commodity often seen as a safe haven during economic uncertainty. A stronger won could impact gold demand in the region, making it more expensive for domestic buyers.
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