Chinese households are increasing their physical gold purchases as global prices decline. On the Shanghai Gold Exchange, the Au99.99 contract recorded 43 million lots traded last week, equivalent to approximately 430 tons. This represents the highest weekly volume for the contract since April, driven by individual investors using bank accumulation plans.
Data indicates that retail demand through these bank plans in the first nine months of the year has already surpassed the total for 2025. In 2025, lenders sold 2 187 tons of gold to consumers, more than triple the volume recorded in 2024. The People’s Bank of China also continues to accumulate reserves, adding 740 000 ounces in September, marking its longest buying streak at 23 months.
The surge in demand coincides with a downturn in domestic financial markets. Since its peak in May, the Chinese stock market has lost $2,4 trillion in value, with the CSI 300 index entering a bear market. Additionally, property sector performance remains weak, and 5-year bond yields reached record lows on Tuesday, prompting investors to seek gold as a safe haven.
Gold prices recently slipped below the $4 000 threshold, trading at $3 996,96 per ounce. The metal has declined 7,73% since the start of the year. Analysts from Global X ETFs and Bank of America suggest that the price may face further tests at the $3 900 and $3 750 levels, depending on upcoming Federal Reserve interest rate decisions.
