Chinese buy more gold due to rise in gold price

In China, too, the rise in the gold price has unleashed a run on investment gold, a spokesperson for the World Gold Council told Reuters. This year, interest in gold bars and gold coins in China was even greater than in jewelry, an exceptional situation.

The price of gold has already risen more than 11% this year and was even at its highest level in a year at the end of last week. This makes it the best-performing asset after a long period in which the precious metal became cheaper and cheaper.

China was the largest market for investment gold last year with a total demand of 201 tonnes. The crash of the stock market and the depreciation of the yuan gave Chinese people extra reason to do so last year. Buy gold. The upward trend in the gold market continues this year, as Roland Wang of the World Gold Council in China told Reuters:

"We've seen very robust investment demand for gold over the last month and a half. The Gold price However, the upward trend must be maintained, as this will determine future purchases by investors. Chinese people buy gold when they think the price is going to rise."

Less jewellery, more gold bars

Normally, only 20% of the total Chinese demand for the precious metal is accounted for by coins and bars, most of it is traded in the form of jewelry. Last year, the demand for jewellery in China fell according to the figures of the World Gold Council by 1% to 783.5 tonnes.

The slowdown in the Chinese economy and the gloomy outlook is shifting demand from jewellery to investment gold. The Chinese middle class and lower incomes have less money to buy jewellery due to the deteriorating economic situation, with the result that an increasing number of jewellers in China have also run into problems.

Wealthy Chinese see the current circumstances as a reason to buy more coins and bars. This is also confirmed by the World Gold Council. "Demand for jewellery is suffering somewhat from the economic headwinds. We are more confident in the investment demand than in the demand for jewellery," Wang stated. He expects demand for the precious metal to be stable this year.

Chinese buy gold due to rise in gold price