(Fox59) Move over, gas and hot dogs. Costco shoppers are snatching up the store’s 1-ounce gold bars despite the market’s lofty price for the precious metal.
A recent Bloomberg survey of Costco stores in 46 states found that roughly 77% sold out of the 1-ounce bars in the first week, despite fully replenishing their stock in recent weeks.
Demand for the bars comes amid soaring gold prices, with the spot price for bullion hitting a record $2,686 on Sept. 26, according to the American Precious Metals Exchange (APMEX). As of Monday afternoon, the price had vacillated between $2,654 and $2,673.
At Costco, the bullion bars currently retail for $2,699.99 but sold for just under $2,000 each in October 2023, when the price of gold was closer to $1,830 per ounce. Costco CFO Richard Galanti revealed during an earnings call that the bars were “typically gone within a few hours” after being listed for sale online.
Investors often turn to gold as a hedge for other economic threats to their nest egg, such as inflation or worries about the U.S. dollar, for instance.
“If someone’s going out to buy gold, that means they think that there’s some type of instability at the structural level of the market and/or the government itself,” added David Wagner III, head of markets and equities at Aptus Capital Advisors.
The Commodity Futures Trading Commission (CFTC) warns that gold is not a “safe” investment, however.
“Like other commodities, precious metal prices rise as demand goes up, so when economic anxiety or instability is high, the people who typically profit from precious metals are the sellers,” the CFTC says.
After the smash success of its gold and silver bullion, Costco recently announced it is selling platinum bars as well.
