Chinese gold demand down 49% since hitting peak in 2013 on surging prices, slowing economic growth
Consumers are spending more on gold jewellery, as many regard it as a value-preserving investment — one that has yielded attractive returns over recent years
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REUTERS/FLORENCE LO
China’s gold demand has dropped by 49 per cent since it hit a peak in 2013 due to surging prices of the precious metal and slowing economic growth. However, gold jewellery consumption is rising in value, according to the World Gold Council (WGC) China research head, Ray Jia.
“Demand surged by 362 per cent between 2001 (when the unified purchase and distribution model was suspended) and 2013 (when demand peaked amid the bargain-hunting buying frenzy) … But consumption, in terms of quantity, entered a sustained decline after 2013, and by 2024 fell 49 per cent, despite periodic rebounds,” he said, commenting on “2025 Chinese gold jewellery consumer insights: Opportunities in the slowdown”.
The decline in the Chinese demand comes at a time when India’s offtake recaptured the 800-tonne mark in 2024 despite soaring prices. In 2013, Chinese demand of the precious metal was 938.80 tonnes and it dropped to 479.14 tonnes in 2024.
Fuelling factors
Jia noted that between 2000 and 2013, factors such as market liberalisation, growing consumer wealth, and urbanisation fuelled the growth in gold demand.
“The downtrend (during 2014-2024) was driven by multiple factors: slowing economic growth, younger consumers’ weakening attachment to gold, and a higher gold price, especially after 2022. And we believe such weakness is driven by both cyclical forces and structural factors,” he said.
WGC modelling analysis reveals that economic growth and interest rate levels are key in determining gold jewellery consumption in China. Such macroeconomic drivers are inherently cyclical, and gold jewellery consumption also reflects observable cyclical patterns, said the China research head.
“…China’s gold jewellery demand closely tracks the 3 to 4-year inventory cycle (commonly referred to as the Kitchin cycle). Currently, the economy appears to be in a protracted transition between passive destocking — the early phase of recovery based on the Kitchin cycle — and active restocking, where the economy booms,” said Jia.
Other bearish factors
China has been going through a period of transition since the second half of 2023, longer than previous cycles. Weak consumer spending appetite after the Covid pandemic, a downturn in the realty sector and ongoing trade dispute with the US are the reasons for this slowdown.
Jia said structural factors have played a pivotal role in shaping China’s gold jewellery demand over the past two decades. “A prime example is the 2001 liberalisation of China’s gold market, which served as a transformative structural change that dramatically boosted gold jewellery consumption,” he said.
China’s shifting demographics have impacted long-term gold jewellery demand relating to newborn gifting and wedding purchases. With both birth rates and the number of marriages declining, gold jewellery demand has come under pressure in recent years, said the China research head.
“From a cyclical perspective, the gold jewellery industry may face a prolonged period of tepid demand, in tonnage terms. Structural factors, including a reduction in the number of births and marriages, also indicate longer-term consolidation,” said Jia.
Q1 buying up 29%
Other factors, such as the declining number of jewellers’ points of sale due to a fall in demand, may reinforce the weakness. “In contrast to tonnage demand, which paints a gloomy picture, gold jewellery consumption in value terms is generally rising,” he said.
Latest WGC data show that Chinese consumers spent 84 billion Chinese yuan on gold jewellery in the first quarter of 2025, up 29 per cent quarter-on-quarter but lower than the first quarter of 2024. However, it was the third-highest quarter on record.
“This paints a very different picture from the tonnage demand change, suggesting that Chinese consumers remain willing to buy gold jewellery, despite costs never seen before,” said the WGC China research head.
Consumers are spending more on gold jewellery, as many regard it as a value-preserving investment — one that has yielded attractive returns over recent years, while some purchase the yellow metal for its aesthetic quality and daily wear.
Buying for self
Jia said the WGC carried out a research project in 2024, which showed that the precious metal enjoys an increasing market share relative to other products.
“Although we found that gold jewellery ownership increases with age, 62 per cent of consumers (aged) between 18 and 24 own gold jewellery, higher than other types of jewellery. This represents a significant increase compared to 2019, when, in a similar survey, 37 per cent of this group owned gold jewellery,” said Jia.
The research showed that 79 per cent of consumers buy gold jewellery for themselves, while 41 per cent purchase it for someone else. This revealed that self-indulgent purchases dominate gold jewellery consumption in China.
While Chinese consumers’ attitude towards gold has not changed, they view gold jewellery as a store of value. However, the Chinese look for products that bring them joy and confidence. But gold jewellery does not stand out as the best product to deliver any of these emotional needs, he said, adding that market saturation was a growing concern among retailers.
Published on July 28, 2025
