Argentina joins the "buy gold" trend

Once nearly fanatical about the US dollar, Argentinians are now changing their wealth preservation methods—from cash to gold bars.

According to the latest report from Bloomberg, Argentinians are experiencing a profound shift in investment psychology. Once one of the countries with the highest dollar holdings globally, Argentina is now captivated by the allure of gold. From physical gold bars to exchange-traded funds, Argentinians are increasingly viewing gold as an alternative preservation tool.

The core driving force behind this shift is that the dollar no longer provides the same inflation hedging function as before. The ongoing rise in the cost of living in the US, coupled with the strengthening of the peso under President Javier Milei, has diminished the dollar's appeal. For many Argentinians, the dollar is now merely a "suboptimal choice" among safe-haven assets.

The relaxation of foreign exchange controls in the country has become a catalyst for this trend. Argentinians can now directly purchase gold with pesos, even opting for interest-free installment payments, completely bypassing the dollar.

Banks Witness "Gold Rush," Gold ETF Inflows Surge 170%

"This is becoming a very trendy phenomenon," said Leonardo Echegoyen, director of Banco Piano. The bank is one of the few in Argentina legally selling physical gold with certificates of origin and a purity rating of 999.9.

Banco Piano, which has a customer base of about 3 million, will quadruple its gold imports from Switzerland by 2025. After completing only two gold shipments throughout 2024, the bank has already completed five this year.

In terms of investment channels, brokerages are facilitating investors through gold ETFs like SPDR Gold Shares (GLD). According to the latest report from the World Gold Council, net inflows into SPDR Gold ETF surged 170% year-on-year in the first quarter, with total investment demand reaching 552 tons, the highest level since early 2022.

Fabio Saraniti, a partner at local brokerage Win Securities, observed: "This year, the demand for gold is greater. When financial assets rise, people want to buy; when they fall, they want to sell."

Jewelers See Daily Inquiry Volume Double

In Argentina, the price of gold jewelry is about $114 per gram, with a bid-ask spread of 10% to 15%. Some purchases can be made in three or six interest-free installments, while banks offer up to 30% cash back—quite attractive in an economy still battling double-digit inflation.

Reports indicate that Argentinians can purchase up to $7,200 worth of gold per month without disclosing the source of funds, with a recent government bill aiming to raise this limit to $12,000.

One of Argentina's most well-known jewelers, Leiva Joyas, has seen its daily gold inquiry volume double in 2025, reaching 300 inquiries per day, with sales this year already doubling compared to 2024. The company's sales manager, Daiana Azcona, stated: "In times of economic uncertainty, people want to preserve their funds. They know that the returns on time deposits are very low." Globally, gold prices have surged over 27% in the past year, hovering around historical highs of over $3,300 per ounce. Geopolitical tensions, stubborn price pressures, and rising expectations for interest rate cuts by major central banks have collectively driven this increase in gold.