Investor trust in nations that mine and purchase gold is rising as a result of the unrelenting increase in the metal’s price, which is bringing windfalls to developing markets.
Shares of miners like Sibanye Stillwater Ltd., AngloGold Ashanti Plc, and Gold Fields Ltd. have tripled in value, putting South Africa, the country with the deepest gold mines in the world, on course for its finest year in twenty years. Moody’s Ratings has raised the credit rating of Ghana, the continent’s largest producer of gold. One of the largest importers of bullion, which helps national coffers, is emerging-market nations.
The rise in gold is providing developing market money managers with yet another reason to be optimistic. Having substantial gold holdings is encouraging investors to purchase by creating a wealth impact for both purchasers and bullion producers. Earlier this month, analysts at Goldman Sachs Group Inc. cited South Africa’s mining prowess as one of the main reasons they believe the nation’s equities and bonds would rise in the future.
According to Daniel Wood, a portfolio manager at William Blair Investment Management, “a limited set of nations in developing economies, such as Uzbekistan, Ghana, and South Africa, benefit from the gold surge.” “Investors are increasingly seeking alternate assets away from the more conventional developed market currencies, especially the US dollar,” reads the broader narrative of the growing price of gold.
Wood said that since Uzbekistan is a significant producer of gold and has sizable reserves, he is optimistic about the country’s currency. He went on to say that rising metal prices are contributing to the unprecedented year South African markets are experiencing.
In 2025, the FTSE/JSE Africa All Shares Index in South Africa has increased by about 30%. The yield on the 10-year government bond has dropped below 9% for the first time in almost seven years, and the rand is close to a one-year high. The country’s central bank has been able to lower interest rates due to slowing inflation, which is also improving market mood.
Overall, it is a significant change for a nation that has long had trouble luring in foreign investment due to political unrest and power outages that have slowed economic expansion.
Ghana is another nation that is profiting from the gold rise. Under new President John Mahama, the country has been on a course to recovery after an economic crisis in 2022 that led to a financial default. This year, the cedi has appreciated by almost 38%, the largest rise in the world.
Other investors said that they are keeping an eye on nations that have been increasing their gold holdings, such as Kazakhstan, Poland, and Turkey. Despite the fact that the trend is typically good, investors should not take it too seriously, according to Ashmore Group Plc’s fixed-income portfolio manager Alexis de Mones.
According to him, “countries with a higher proportion of gold in their reserves will also seem better, but one should not always look to price impacts as a source of credit strength.”
The fact that rising gold prices coincide with a lower dollar and generally improving financial circumstances is the greater motivator for developing markets, de Mones said. Ning Sun, a senior emerging-markets analyst at Boston’s State Street Markets, shares that opinion.
According to her, increasing gold prices often accompany a wider trend that pulls down anything dangerous. However, in this instance, that link has reversed due to dollar weakness and anxiety over US economic policies. Emerging markets are increasingly proving to be successful.
“Emerging markets do gain more from the upswing than mature ones,” she said. “Emerging markets hoard gold in addition to producing it.”