China Is Buying Gold Differently: Investment Gold Overtakes Jewellery

Gold jewellery has long been a way to celebrate, give gifts, and hold wealth in China. But buyers are increasingly choosing gold in a simpler form: bars and coins.

Chinese bar-and-coin demand reached 431.7 tonnes in 2025, up 28% from the previous year. For the first time in the World Gold Council’s data series, it exceeded jewellery consumption.

The shift continued into 2026, with record investment buying in the first half of the year. It points to a change in what buyers want from gold: more are buying it to hold as an asset, rather than to wear.

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A record start to 2026

China bought 206.9 tonnes of gold bars and coins in the first quarter of 2026, a 67% increase from a year earlier and its strongest quarter on record, according to the World Gold Council’s Q1 investment report.

Buying slowed to 107.2 tonnes in the second quarter. Even so, the combined first-half total reached about 314 tonnes, the highest recorded for that period. China remained the world’s largest bar-and-coin market, the Q2 investment report shows.

These figures measure gold demand by weight. They do not count individual buyers or mean that every Chinese household is moving away from jewellery.

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Jewellery buyers are feeling the price increase

Chinese gold jewellery demand fell 32% year-on-year to 85.2 tonnes in the first quarter of 2026. High gold prices were the main pressure, alongside weak consumer confidence and modest income growth.

Yet spending on jewellery rose 16% to roughly US$13 billion, according to the World Gold Council’s Q1 jewellery report.

That distinction matters. Consumers were spending more money but receiving less gold. Some chose smaller or lighter pieces to keep purchases within their budgets.

Jewellery also includes costs beyond the metal itself, such as craftsmanship, design and retail margins. For someone buying mainly to hold gold, those extra costs can make a plain investment product more appealing.

Bars and coins carry extra costs too. Our guide to physical gold premiums explains why their retail prices exceed the underlying gold value and why a buyer may not recover the full premium when selling.

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Why investment gold is attracting buyers

The World Gold Council identifies several factors supporting Chinese investment demand: uncertainty about the economy, weakness in property, low domestic yields and geopolitical risk.

A household concerned about property values may want to spread its savings across other assets. Low yields on interest-bearing investments can also make gold more attractive, although gold itself pays no interest.

Price performance plays a role as well. The Q1 report points to gold’s strength relative to other local assets as a driver of buying. Rising prices can attract investors even while making jewellery harder to afford.

These are different responses to the same market. A jewellery buyer may postpone a purchase because the price has risen. An investment buyer may see that rise as a reason to pay closer attention.

Continued purchases by the People’s Bank of China have also reinforced domestic confidence in gold, according to the Q2 report. Central-bank reserves and household investments are separate sources of demand, but official buying can influence how consumers view the metal.

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Tax changes are reinforcing the shift

China’s gold VAT reforms, introduced in late 2025, have added another reason for some buyers to favour investment products.

The World Gold Council reports that investment products remain exempt under the revised framework. Some consumers who previously bought jewellery partly as an investment have consequently shifted towards bars, coins and gold accumulation products.

The distinction is about purpose as well as purity. Jewellery can hold substantial gold value, but its purchase price may include costs unrelated to the metal. Our gold purity guide explains how gold content differs across karats and what that means when valuing a piece.

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What this means for the wider gold market

China’s changing demand mix helps explain why weak jewellery sales do not automatically mean weak interest in gold overall. Investment buying can offset some of the decline in jewellery consumption.

It also changes what market watchers need to follow. Household confidence, returns on competing assets and demand for wealth protection become increasingly relevant alongside traditional jewellery-buying occasions.

The record first-half total does not guarantee continued growth. Second-quarter bar-and-coin demand was almost half the first-quarter level and 7% below a year earlier. Investment buying can slow as prices fluctuate, confidence changes, or buyers take profits.

For readers comparing gold products, the useful distinction is between the value of the metal and the full cost of buying it. Start with current gold prices on GoldRates, then account for purity, premiums and the dealer’s buyback terms. Existing owners can use My Gold to follow their holdings’ reference value over time.

Jewellery remains an important part of China’s gold market. The change is that investment products now account for a larger part of the buying. Understanding that balance gives a clearer picture of demand than looking at jewellery sales alone.

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This article is for informational purposes only and does not constitute financial or investment advice. Gold prices, exchange rates, and retail premiums can change quickly.