SHANGHAI: China’s gold consumption dropped 7 percent year on year in the first quarter of 2015, mainly due to a cooling economic growth and investment shifted to stock markets, World Gold Council said today.
Consumption of gold shrank to 272.9 tons in China, compared to 1 percent decline of global markets and a 15 percent surge in India.
Among which, jewelry demand slumped by 10 percent year-on-year, the council said, blaming slowing economy that impacted consumer sentiment and government’s anti-corruption drive to restrain demand.
“Rallying domestic equity markets also ate into quarterly gold demand in China, which has lacked firm price direction in recent quarters,” WGC said.
China bought 976.3 tons of gold in 2014 being world’s biggest consumer. Though India is expected to take over the place with nearly 900 tons of demand this year, as investment motive remain weak among Chinese buyers, said Samson Li, senior analyst at gold industry researcher Thomson Reuters GFMS.
Gold price shed 6 percent to US$1,218.5 per ounce by the first quarter. GFMS expected an annual average gold price at US$1,170 per ounce.
Dong Feng, analyst with Trading Center at Precious Metals Department of Industrial and Commercial Bank of China, said that no sign for a bull market of gold has been seen in the current stage, which will make the gold to stay at a relatively low price for another six to 12 months.
