Tuesday, June 6

China’s gold demand to fall in second half from 2021 levels – WGC

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China’s demand for gold jewelry, bars and coins is expected to fall year-on-year in the second half of 2022, a World Gold Council (WGC) official said, as lockdowns to contain coronavirus outbreaks cause uncertainties and cut consumer spending.

While demand is likely to see month-on-month gains in the second half, overall buying during the period is forecast to show double-digit declines on an annual basis, Wang Lixin, the WGC’s chief executive in China, said in a statement on Thursday.

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“The uncertainty brought about by repeated epidemic (outbreaks) and the pressure of the domestic economy may have a negative impact on gold jewelry demand,” said Wang.

Previously suppressed demand for wedding jewelry could help boost consumption if further COVID outbreaks are contained, he added however.

The WGC also reported declines in consumption of gold jewelry, bars and coins during the first half of the year on the back of coronavirus outbreaks in China, the world’s largest gold consumer.

Behavioral changes also contributed to the demand slowdown, said the council, as a slowdown in income growth and uncertainties caused by virus outbreaks caused consumers to increase their savings.

Cities across China endured strict curbs and lockdowns this year in efforts to curb the spread of the virus, which hit economic activity and consumption.

The China Gold Association also said on Wednesday that the country’s gold consumption fell 12.8% in the first half of the year from the corresponding period of 2021. (Reporting by Emily Chow in Kuala Lumpur; Editing by Jan Harvey)