A relentless surge in the price of gold is delivering windfalls across emerging markets, boosting investor confidence in countries that mine and buy the metal.

In South Africa, home to the world’s deepest gold mines, stocks are on track for the best year in two decades, with shares of miners like Sibanye Stillwater Ltd., AngloGold Ashanti Plc and Gold Fields Ltd. tripling in value. The credit rating of Ghana, Africa’s top gold producer, has been upgraded by Moody’s Ratings. Emerging-market countries rank among the biggest buyers of bullion, boosting national coffers.

For money managers in emerging markets, gold’s surge is giving them another reason to stay bullish. By fanning a wealth effect for bullion-producers and buyers alike, valuable gold holdings are giving investors more conviction to buy. In a report earlier this month, Goldman Sachs Group Inc. strategists listed South Africa’s mining strength as a top reason it sees gains ahead for the country’s bonds and stocks.

“The rally in gold is beneficial for a small group of countries in emerging markets such as Uzbekistan, Ghana and South Africa,” said Daniel Wood, a portfolio manager at William Blair Investment Management. “The wider story of the rising gold price is that investors are increasingly looking for alternative investments away from the more traditional developed market currencies, particularly the US dollar.”

Wood said he’s bullish on Uzbekistan’s currency because the country is both a major bullion producer and holds substantial reserves. He added that soaring metal prices are part of the reason why South Africa’s markets are having such a historic year.

South Africa’s FTSE/JSE Africa All Shares Index has gained more than 30% in 2025. The rand is near a one-year high, and the 10-year government bond yield recently fell below 9% for the first time in more than seven years. Slowing inflation that’s allowed the country’s central bank to cut interest rates is also boosting market sentiment.

All in all, it’s a dramatic turnaround for a country that has struggled to attract investors for years because of political turmoil and power shortages that sapped economic growth.

Another country that’s benefiting from the gold rally is Ghana. After enduring an economic crisis in 2022 that caused it to default on its debt, the nation has been on a path to recovery under new President John Mahama. The cedi has strengthened about 38% this year, the biggest increase globally.

Other investors said they’re watching countries like Poland, Turkey and Kazakhstan, which have all been adding to their gold reserves. Alexis de Mones, a fixed-income portfolio manager at Ashmore Group Plc, said that while the trend is generally positive, investors shouldn’t read too much into it.

“Those countries that have a greater share of gold in their reserves will also look better, but one should not necessarily look at pricing effects as a source of credit strength,” he said.

The bigger driver for emerging markets is the fact that higher gold prices are coming at a time when the dollar is weak and financial conditions are broadly easing, de Mones added. That’s a view echoed by Ning Sun, a senior emerging-markets strategist at State Street Markets in Boston.

She said rising gold prices are usually part of a broad move that drags down anything risky. But in this case, given dollar weakness and nervousness about US economic policy, that relationship has flipped. And now, emerging markets are turning out to be a winner.

“The rally does benefit emerging markets more than developed markets,” she said. “Emerging markets not only produce gold, they also hoard the metal.”

(By Selcuk Gokoluk)