WGC sees gold jewellery sales in China remaining weak in coming months
This story was originally published at 19:47 IST on 16 June 2025
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MUMBAI – Sales of gold jewellery in China may remain weak in the coming months owing to tepid consumer sentiment and an off-season, Ray Jia, World Gold Council research head (China), said in a report. "...while China's economy, at a macro level, might have received some support from monetary and fiscal policies (of the government), sentiment at the consumer level is yet to recover," Jia said in his report.
Jia said this could be seen in recent credit data trends: year-on-year increases in total social financing were mainly driven by strong government debt issuance amid various fiscal support while households remained reluctant to borrow. "Facing such challenges, combined with seasonality, gold jewellery consumption could remain tepid in tonnage terms in coming months," Jia added.
Moreover, easing trade tensions and a consolidation in gold prices, if it continues, could weigh on safe-haven investment demand for gold in the near term, he said. However, in the mid-to-long term, declining government bond yields and elevated global geopolitical risks may provide support for investment in gold.
Gold prices fell mildly in May "...as investors sold gold ETFs (exchange-traded funds) and gold's implied volatility fell", Jia said. Chinese gold ETFs recorded outflows in May, losing $461 million and ending a three-month inflow streak. Following the outflows and the decline in gold prices, total Chinese gold ETF assets under management fell 4% on month to $21 billion. "Improved investor risk appetite was a major driver of gold ETF outflows last month. The temporary tariff truce between China and the US improved investor sentiment, evidenced by stronger equities, and the appreciating RMB (renminbi) reduced the safe-haven demand for gold," Jia said.
The People's Bank of China added 1.9 tonnes of gold to its reserves in May, the seventh consecutive month of gold buying, with total holdings at 2,296 tonnes. China's gold reserves amount to $242.00 billion, a slight 1% fall on month due to weaker gold price. In 2025, the central bank has added 16.8 tonnes of gold to its reserves.
Net gold imports into China totalled 112.0 tonnes in April, up 66.0 tonnes on month, Jia said, citing data from the Chinese customs department. " The escalating US-China trade tension during the month raised investor safe-haven demand for gold in China significantly--both bullion sales and gold ETF demand surged--leading to an increased need for imports," Jia added. End
US$1 = INR 86.06
Reported by Ashutosh Pati
Edited by Rajeev Pai
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