Gold is witnessing a resurgence in popularity, with the precious metal reclaiming its allure this year, driven by the country’s younger generation.
Consumption of the yellow metal, whose appeal had once waned as Chinese consumers favored diamonds and other gems, has remained robust during the Spring Festival holiday despite elevated prices.
As the world’s largest precious metals market geared up for the Chinese New Year celebrations this year, gold jewelry and the Year of the Dragon gold bars have emerged as the most popular products, according to the China Gold Association.
Boosted by a series of policies aimed at stimulating consumption, the domestic consumer market has recovered steadily, with gold and silver jewelry emerging as the fastest-growing categories among various retail segments through last year, it said.
The domestic gold consumption market has shown signs of improvement since last year as China’s central bank and retail consumers alike turned to the safe-haven asset, said Zhang Yongtao, vice-president and secretary-general of the China Gold Association.
Gold jewelry processing and retail enterprises in China have also continuously innovated in the design of gold products, driving the increased demand for gold jewelry. Gold bars and coins with relatively lower premiums have also been favored by consumers seeking physical gold investments, said Zhang.
While the Spring Festival holiday has always been a peak season for gold sales, gold jewelry featuring the zodiac sign of the dragon has been especially popular this year, and the rising gold prices have not deterred consumers’ purchasing enthusiasm, according to the Beijing Caishikou Department Store.
Several Chinese gold jewelers are designing various jewelry products bearing traditional Chinese cultural elements to satisfy the aesthetic needs of young consumers.
Shandong Gold Group, for example, said it has been actively engaged in exchanges and cooperation with universities, inheritors of intangible cultural heritages, and cultural and art institutions, to better explore the integration of traditional culture with innovation in gold jewelry designs and techniques, in order to inject vitality into the gold industry.
Fashionable and lightweight gold jewelry has gained significant favor among consumers, contributing to the overall increase in gold jewelry consumption, said the association.
Young Chinese aged between 25 and 34 have become the main force of gold consumption, with their proportion at 59 percent in 2023. In the future, consumers under the age of 25 will become new major gold buyers, it said.
Gold jewelry, once considered old-fashioned, is now drawing interest from younger Chinese. Demand has been pretty decent, considering where the price is, said Nikos Kavalis, managing director at consultancy Metals Focus Ltd.
In the not-too-distant past, gold symbolized the taste of the older generations, but it is now a statement of Generation Z’s identity that represents both personal style and cultural loyalty, said Wang Zhongwu, professor at the School of Philosophy and Social Development of Shandong University.
Wang Lixin, CEO of the World Gold Council (China), has said previously that the introduction of various economic stimulus measures with a focus on consumption has also contributed to the growth in purchases of gold jewelry since last year.
The country’s gold consumption rose 8.78 percent year-on-year to 1,089.69 metric tons in 2023, according to the association.
Of the total, gold jewelry consumption hit 706.48 tons, a year-on-year increase of 7.97 percent, while gold bars and coins touched 299.6 tons, up 15.7 percent year-on-year, it said.
Gold production, meanwhile, rose 0.84 percent year-on-year to 375.155 tons, it said.
The council believes gold output and consumption will remain in the positive territory and continue to garner attention from global investors in 2024, fueled by economic recovery and sustained purchases by the central bank.
zhengxin@chinadaily.com.cn