Gold price hits new peak, people in one country still buy 290 tons

CHINA - Despite gold prices continuously hitting new peaks in the first three months of the year, people in the billion-people country continue to pour money into this precious metal, with a firm belief in its role as a 'safe asset' amid the uncertain global economy.

According to the latest report from the China Gold Association (CGA), the country's total gold consumption in the first quarter reached 290,492 tons, down slightly by 5.96% over the same period last year.

But overall, individual investment demand has surged. Gold bars and coins have increased by nearly 30% to 138 tonnes. The sentiment of hoarding assets to hedge against risks is spreading among Chinese investors.

The survey also showed that the 25-34 age group is gradually becoming the main gold consumer force. The proportion of young people in Beijing buying gold has increased sharply from 16% to 59% in 2024.

China's total gold consumption in the first quarter of 2025 reached 290,492 tons. Photo: Baidu

Reshaping consumer tastes: Less jewelry, more investment

While the gold investment sector has broken out, gold jewelry has recorded a deeper decline of 26%, to about 134.5 tons. However, analysts say this decline is not simply a negative signal.

Instead, it reflects a shift in tastes, particularly among younger generations, who increasingly favor minimalist, lightweight designs or combinations of gold with other materials such as gemstones, enamel or high-end synthetics, rather than traditional, heavy, classic designs.

Notably, investment cash continues to flow strongly into the domestic gold market. The amount of gold held by Chinese investors through exchange-traded funds (gold ETFs) skyrocketed by 23.47 tons in the first quarter, equivalent to an increase of more than 327% compared to the same period in 2024. ETFs allow investors to indirectly own gold through fund certificates, instead of buying physical gold.

Not only individual investors, large financial institutions in China are also actively participating in the game. Since February 2025, the National Financial Regulatory Authority (NFRA) has given the green light to test gold investment using capital from the insurance sector.

This move was seen as opening a new door for financial capital to flow into the precious metals market. Just one month later, the first deal was made between Industrial and Commercial Bank of China (ICBC) and China Life, marking a pioneering step in making gold a mainstream investment asset in the country's financial ecosystem.

In the spot market, the Shanghai Gold Exchange (SGE) and the Shanghai Commodity Exchange (SHFE) recorded a surge in trading volume and value, reaching tens of trillions of yuan in the first quarter.

From 'savings' to national strategic tool

At the macro level, the People's Bank of China (PBOC) continues to increase its gold accumulation. In the first quarter, the PBOC purchased an additional 12.75 tons, bringing its total reserves to 2,292.33 tons. China maintains its position as one of the world's largest gold reserve countries, behind only Russia and the United States.

More and more young Chinese are buying gold. Photo: Baidu

At the same time, domestic gold mining corporations also took full advantage of the wave of high prices to boost production.

Domestic gold output in the first quarter reached 140.83 tons, up 1.18% over the same period. Of which, gold mined from mines reached 61.74 tons, the rest came from recycled gold and processed from imported materials.

Not only consolidating their position in the domestic market, Chinese gold giants such as Chi Phong Ky Long and Tu Kim - Shandong are actively expanding globally. In the first quarter, gold output from overseas mines owned by Chinese enterprises reached more than 18.4 tons, up 13% over the same period last year.

In the context of prolonged global economic instability, especially geopolitical tensions in Europe and the Middle East or public debt risks in the US, gold is still considered by the Chinese as a safer and more sustainable channel to preserve value than stocks or real estate.

Analysts say that if the US Federal Reserve (Fed) cannot start its interest rate cutting cycle in the first half of this year, while US-China trade tensions continue to simmer, gold will continue to be favored as a financial "lifebuoy" in the heart of the world's second largest economy .

(According to The Paper)

The country 'beats its chest' proudly: Come here if you want to buy the cheapest gold in the world UAE - While the world gold market is immersed in a whirlwind of price increases, the Middle East is shaping a new trend: Jewelry retailers in the UAE not only sell gold but also 'sell' the message: 'Come to the UAE if you want to buy the cheapest gold in the world'.

Source: https://vietnamnet.vn/gia-vang-lap-dinh-nguoi-dan-mot-quoc-gia-van-manh-tay-mua-290-tan-trong-quy-i-2406858.html