Gold has reached new record highs this year, but that hasn’t slowed down bullion bar sales at Costco stores across the US, where people are rushing to get their hands on the gold.
Costco is making it easy for people to buy gold by offering it at lower prices than regular gold dealers. Loyal customers also get extra rewards when they purchase.
Costco’s gold bar rush
With gold being seen as a safe choice during uncertain times and as protection against rising prices, many buyers are turning to Costco to get their share, as reported by Bloomberg.
“It’s a great experience overall,” said Sourav Sethia, a 33-year-old analytics engineer from New Jersey. “I get calls from Costco whenever gold bars arrive as I am a previous buyer. So whenever I see the price has pulled back, I rush to Costco to buy one.”
On September 28th, Sethia visited his local Costco, where gold bars for Diwali were being sold for $2,699.99. Though he didn’t buy one this time, he previously purchased two in the last four months to protect against inflation.
Costco $COST is selling an estimated $7 million of gold bars PER DAY. pic.twitter.com/ofmOLbwbxd
— Kevin Malone (@Malone_Wealth) April 12, 2024
This reflects a trend of shoppers seeking gold at Costco, even as prices hit record highs. A survey found that 77 percent of Costco stores with gold bars were sold out in early October, shortly after receiving fresh stock, according to Bloomberg.
Americans selling their gold amid financial struggles
Spot gold has surged nearly 30 percent this year, repeatedly reaching record highs. This strong rise has made it one of the top-performing commodities, outperforming US stocks and bonds.
Gold’s increase is due to its reputation as a safe asset during economic and political uncertainty and its role in protecting wealth. Last month, gold prices went above $2,600 an ounce, helped by the Federal Reserve’s rate cuts, as gold usually rises when rates are low.
While Costco sees a surge in gold buying, many Americans are selling their gold due to financial struggles. New York pawn shops and jewelers report an increase in sellers. Sales of American Eagle gold coins, a sign of retail buying, dropped 64 percent from January to September compared to last year, according to US Mint data.
Costco is the “one bright spot” in consumer gold buying, according to Nicky Shiels, head of metals strategy at MKS PAMP SA. She noted a new group of retail buyers entering the market and believes this trend is positive in the medium to long term, as Costco attracts more people to invest in gold.
Costco began selling gold bullion in June 2023, both in US stores and online. The Swiss-made 24-karat bars are small, about the size of a mini chocolate bar, and come in cardboard and plastic packaging.
