China’s gold markets under strain as horde of new buyers hunts for stable investment
- China’s gold market, considered one of the country’s few safe investments, has been booming as buyers look to cash in on price jumps
- Precious metal has seen regular peaks in value in recent months, with retail sites slammed with requests from eager would-be speculators
April has been a busy month for the Hualin International Jewelry Market in Guangzhou. A scrum of eager buyers has descended upon the venue, looking to join a new gold rush as prices soar and the precious metal takes on new life as a vehicle for investment.
The Guangzhou market, originally known for its bustling jade and jewellery trade, has been “flooded” with newly opened gold stores, with dozens emerging according to a store owner earlier this week.
“The number of customers is also increasing day by day,” said the owner, who asked not to be identified by name. “Sometimes it feels like a crowded wet market.”
Rapid price changes have made for a mercurial scene. “From the beginning of the year until now, there have been customers buying gold bars for tens of thousands, hundreds of thousands of yuan,” he said. “But since the current price is extremely high, consumers are becoming cautious. Most of the new customers are buying products with lower grams.”
According to another merchant, many have begun to sell their stock.
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Chinese consumers sell off old jewellery amid record high gold prices
“Today’s buy-back price is 554 yuan (US$77) per gram,” the merchant said. “Just now, a lady who got married last year sold me the gifts she received at her wedding, including necklaces, pendants and bracelets.”
