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Significant Decline in China’s Gold Consumption at the Start of 2025
The China Gold Association announced a 5.96% year-on-year decline in gold consumption, reaching 290.492 tons in Q1 2025, due to the continued rise in gold prices that reduced demand for gold jewelry and ornaments.
The association explained that the rise in gold prices led to a shift in consumer behavior, with a decline in demand for traditional products like jewelry and gold ornaments, while interest in purchasing gold bars and coins as an investment method increased.
Gold jewelry consumption dropped by 26.85% year-on-year to 134.531 tons in Q1, while gold bar and coin consumption surged by 29.81%, reaching 138.018 tons, driven by investors seeking safe assets amid geopolitical uncertainty and economic volatility.
Local gold production in China rose by 1.49% year-on-year to 87.243 tons in Q1 2025.
Including gold produced from imported materials, which totaled 53.587 tons, China’s total gold production reached 140.830 tons in Q1, marking a 1.18% increase compared to the same period last year.
This comes as gold prices hit new record levels at $3,500.05 per ounce on April 22, driven by heightened trade tensions between the US and China. However, after this significant increase, the gold market saw a notable decline in the following days as market volatility eased and renewed interest in the US dollar and bond yields emerged.
Despite some profit-taking in the gold market, described by some analysts as a necessary consolidation, most do not expect last week’s peak to be the highest point of the year.
