The Chinese New Year, a vibrant and culturally significant festival, traditionally marks a peak season for gold purchases in ChinaIn recent visits to multiple gold stores, banks, and sales channels for panda coins post-holiday season, it became evident that a surge in consumer enthusiasm coincided with continually rising gold prices, creating a flurry of gold-buying activityIn bustling shopping centers within Beijing, several reputable gold jewelry brands reportedly saw their sales skyrocket by over 100% during the festive period, illustrating a robust consumer appetite for gold.

On February 10, the allure of gold became further entrenched as the London spot gold price surged past the $2900 markReports indicated that during trading, the price reached a high of $2906.25 per ounce, while COMEX gold futures peaked at $2932.8 per ounce, both showing daily gains exceeding 1.5%. Since the start of the year, the spot gold price had already risen nearly 10%. Analysts attribute this upward trend to the economic policies implemented by the U.S. president, which have intensified inflation and subsequently propelled gold prices to new heights.

However, experts and consumers alike warned of the inherent risks associated with investing high amounts in gold amidst such fluctuationsOn the same day, the Shanghai Gold Exchange issued a notification alerting members to the increased risk of significant price volatility and urged investors to exercise judicious investment strategies.

As gold prices soar, many consumers have been drawn to purchasing gold jewelry once againNumerous jewelers, including well-known brands such as Cai Bai, Chow Tai Fook, and Lao Fengxiang, reported a substantial increase in sales for gold ornaments, particularly in bracelets, necklaces, and pendantsOne salesperson noted that their store generated revenue exceeding 100,000 yuan daily during the festive season, significantly higher compared to normal trading periods.

In the competitive realm of retail, gold has emerged as a leading commodity in sales performance

Advertisements

According to industry insights, the average transaction value in places like Beijing's Super Extreme Harmony increased by more than 50% during the Spring Festival, with gold and jewelry sales experiencing a remarkable growth of over 68% month-over-monthNotably, out of the top five selling brands, two were prominent gold jewelry brands, signaling the market's strength.

Even after the festive season, the demand for gold jewelry showed no signs of waningStaff members from various stores relayed their enthusiasm for the busy shopping days following the holiday, as many loyal customers returned to make purchases after holding off before the New YearOne gold merchant indicated a sales figure of over 70,000 yuan on a busy day, fueled by returning customers wary of increasing prices.

Interestingly, this spike in consumer investment was not without its unexpected challengesData from the China Gold Association revealed that the overall consumption of gold in 2024 had already decreased by 9.58% compared to the previous year, primarily skewed by a significant decline in jewelry demand of approximately 24.69%. Yet, during the Spring Festival, this trend notably reversed, as consumers embraced gold purchases amid rising prices.

Aside from the bullish mindset surrounding gold, various promotional offerings during the Spring Festival attracted consumersAs gold prices continued to climb, jewelry brands increased their pricing, often exceeding 800 yuan per gram, while premium items were sold at even higher pricesConveniently, several stores launched promotional campaigns that offered substantial discounts and benefits, allowing consumers to experience greater perceived value amidst a backdrop of rising costs.

Gold bars and coins—considered safer options for preserving value—also witnessed heightened sales activitySeveral bank employees highlighted that physical gold bars had been in short supply, as a cultural preference among Chinese consumers traditionally elevates purchases during the holiday period

Advertisements

This ongoing demand was intensified by aggressive marketing strategies from various brands to spark enthusiasm among potential buyers.

Since 2019, various socio-economic conditions—including sluggish growth in the economies of Europe and the U.S., the repercussions of the pandemic, lax monetary policies, and heightened geopolitical tensions—have collectively catalyzed a bull market for goldAs prices swell, consumers are increasingly aware of the substantial appreciation in specific products, such as the beloved panda coinsFor instance, a set of standard panda coins previously retailed for around 20,000 yuan, while current prices for individual coins are nearing that same level for just one 30-gram coin.

Market anticipations suggest that the bullish sentiment surrounding gold may continueAnalysts from the financial derivatives investment research institute in Hong Kong noted that rising tariffs and escalating geopolitical unrest have provided a solid foundation for gold price increasesIf tariff tensions escalate further, the investment demand for gold is expected to rise, reinforcing price supports significantly.

As the economic narrative unfolds, various reports claim that central bank asset acquisitions should also provide a major boost to gold prices moving forwardData recently published by the People’s Bank of China revealed an increase in gold reserves, reinforcing investor confidence in government policy that supports sustained gold accumulation.

Furthermore, traffic from incremental investments, particularly in the insurance sector, looks set to provide additional upward momentumAs of February 7, authorities introduced a trial program allowing insurance funds to invest in gold, anticipating that this move could inject as much as 200 billion yuan into the market, creating additional buying pressure.

Nevertheless, even as bulls ramp up their positions, there are words of cautionAnalysts urge potential investors to carefully assess which types of gold investments—such as physical bars versus paper gold—best suit their financial strategies

Advertisements

Advertisements

Advertisements