Gold demand in China dropped by 6% in first quarter amid rising prices

The China Gold Association reported Monday that the country's gold consumption fell by almost 6% year-on-year in the first quarter of 2025, totaling 290.492 tons. Analysts linked the decline to surging gold prices, which curbed jewelry demand while boosting demand for investment-grade bullion and coins.

The agency has observed a notable shift in Chinese consumer preferences. The quarter saw a striking divergence: jewelry buyers retreated (down 26.85% to 134.531 tons) while investors piled into physical gold products (up 29.81% to 138.018 tons). Analysts attributed the spike in investment demand to heightened interest in safe-haven assets.

On the supply side, China produced 87.243 tons of gold domestically, up 1.49% from a year earlier. Factoring in 53.587 tons refined from imported feedstock, the country’s total gold output reached 140.830 tons, marking a 1.18% annual gain. High prices are changing both consumer behavior and market dynamics in China, Reuters experts said.