Don't count on central banks to fuel the gold rush. Ask South Korea


Gold bugs readily cite plenty of reasons why they think the precious metal's price will keep climbing. One argument gaining prominence lately is that the world's central banks will rush into gold, pushing the price ever-higher. But apparently the central bankers haven't gotten the memo.

On Tuesday, the Bank of Korea -- the world's sixth-largest central bank -- became the latest one to pour cold water on the notion that it would buy gold to diversify out of the dollar. "There's an illusion in gold," Lee Eung Baek, the head of the bank's reserve-management department, told Bloomberg News in an interview. "We follow the big trend. Gold isn't the trend. Out of more than 200 nations, how many countries have bought bullion?"