As the Lunar New Year holiday approaches, the tradition of buying gold in China has gained momentum, with new data revealing a significant increase in gold purchases despite rising prices.
This trend is seen as an encouraging sign for retailers gearing up for the Spring Festival holiday.
CGTN’s Chen Tong reports from Shanghai’s renowned Yuyuan Garden.
WATCH: Gold in the year of the dragon
In the heart of Shanghai’s scenic Yuyuan Garden shopping precinct, one of the largest gold jewellery stores is witnessing a surge in shoppers eager to purchase gold items for themselves and their families.
Gold jewellery adorned with dragon motifs is particularly popular as the country prepares to welcome the Year of the Dragon.
One male shopper expressed his intention to buy a new gold bracelet for his wife, explaining, “I want to buy one for my wife because my wife’s bracelet is old, and she doesn’t want the old one. I said if you don’t want that one, I’ll buy you a new one.”
Another female shopper expressed interest in seeing bracelets and engaged in a conversation about their origins.
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Chen Mengyi, the Regional Manager of Shanghai Area at Laomiao Jewelry, explains the diverse reasons behind the surge in gold purchases.
She notes, “Consumers who received their year-end bonus will purchase gold as investments or buy jewellery to dress up.
The Year of the Dragon is approaching; some will buy a dragon-shaped pendant to give to newborn babies and the elders in the family.”
Despite increases in gold prices over the past year, Chinese consumers are finding the precious metal an attractive investment.
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Wang Lixin, CEO of World Gold Council China, states, “Gold price increased last year in RMB term by 16.8%, a very attractive return compared with other mainstream financial assets.
You can find very few real competitors in that return.” He further explains that despite higher prices, young consumers are pursuing a strategy of “saving consumption,” where they can both consume and have a sense of savings.
According to the China Gold Association, gold consumption in China exceeded 1000 tons in 2023, marking a year-on-year increase of around 9%.
Gold jewellery sales experienced an 8% jump, while sales of gold bars and coins surged by over 15% during the same period.
As the Chinese prepare to celebrate the Spring Festival and usher in the Year of the Dragon, the robust demand for gold reflects both cultural traditions and the metal’s appeal as an investment in uncertain times.
