High-Scattering Gold Price Threatens First Anniversary Ring Tradition In South Korea

JAKARTA - The soaring gold price has recently threatened a tradition that has been going on for generations in South Korea.

In Ginseng Country, gold rings have a deep meaning, traditionally given by family or friends to wish their baby health and luck on their first birthday.

The gold ring also functions as a financial safety net in the future, something that can be sold during difficult times.

"My son received a gold ring on his first birthday in 2015. This year, my friend's son is one year old, and I can't ignore how high the price of gold is," said a woman in her late 30s, who asked to be identified as Min, reported by The Korea Times on May 1.

"Since I received the ring at that time, I feel indecisive. Should I continue my tradition and give a gold ring, or is it better to just give me cash?" he continued.

The habit of giving gold rings on the baby's first birthday stems from Chinese immigrants arriving in Korea during the Joseon Dynasty. Gold is believed to ward off bad luck and, thanks to its long-lasting value, symbolizes investment for the future of children.

Gold also has a historically important meaning in the Korean economy. During the 1997 Asian financial crisis, many families donated their valuable gold rings to the national gold collection campaign to help stabilize the economy.

Currently, public doubts stem from the unprecedented increase in gold prices. Since the beginning of the year, the price of gold in the spot market has soared by almost 30 percent, having reached its highest point at 3,500 US dollars per ounce.

Demand has surged globally, driven by geopolitical tariffs and tensions that began since US President Donald Trump took office.

In Korea, the increase is more pronounced. In February, the so-called "premiumition" where domestic gold prices exceed international prices reached around 20 percent.

Gold rings or bracelets with the same weight are generally more expensive due to additional work costs and value added tax.

Including additional costs from jewelry makers, the one-don gold ring for the baby's first birthday now exceeds 700.000 won.

"Currently, most people choose half-don gold rings (a traditional South Korean gold unit weighing 3.75 grams) rather than a full one. Even people who have gold rings from their previous birthday are considering selling them," said a jewelry store owner in Jongno District, Seoul.

"This is worrying because manufacturing costs are our main source of income," he said.

Another factor that reshapes the tradition is the shift towards small birthday celebrations and is only attended by the family.

In the past, the baby's first birthday was marked by a large meeting of celebrations to survive at a high infant mortality rate. But today, with increased health care and changes in social values, such as a decrease in the number of marriages and births, the celebration becomes simpler.

Market observers anticipate gold prices will continue to rise. JP Morgan even projects that the price of gold could surpass 4,000 US dollars per ounce due to stagnation concerns.

Many turn to alternatives. One of the trends that emerged was the 1 gram gold ring, which costs similar to the one gram ring from a decade ago, along with the mini gold bullion available at various price points.

"Receiving a gold ring for one doesn't feel burdensome at this time," commented an online user at the community forum for mothers in Gyeonggi Province. "It's better to give something practical and not burden both parties."