China's Gold Market Shifts towards Alternative Forms of Investment
China's gold market is undergoing a significant shift as consumers opt for alternative forms of gold investment over traditional jewelry purchases. With gold prices surpassing 950 yuan per gram, ordinary consumers are no longer calculating by weight but by premium.
The premium, which includes brand charges, craftsmanship fees, and design costs, is making it increasingly difficult to justify the purchase of gold jewelry. As a result, consumers are turning to gold bars, gold coins, and gold ETFs as more affordable options for investing in gold.
According to data from the World Gold Council, China's gold jewelry demand fell 30% year on year to just 136 tonnes in the first half of 2026. In contrast, investment demand for gold bars and coins surged 31% year on year to 314 tonnes, marking the strongest first-half performance on record.
The shift towards alternative forms of gold investment is driven by a growing awareness among Chinese households that asset allocation should not rely on a single investment. With housing subject to real estate cycles, stocks vulnerable to market volatility, and deposit interest rates fluctuating, gold remains an attractive option for diversifying risk.