2020 has been a memorable year for China’s economy and its gold market. Combining their changes in the last month of 2020, we aim to paint a comprehensive picture of what happened in China’s gold market last year and identify possible drivers for the nation’s gold demand in 2021 based on our recently published Gold outlook 2021.

In 2020: 

  • The Shanghai Gold Benchmark Price PM had a strong year, yet it remained at a wide discount to the LBMA Gold Price AM when measured in the same currency
  • China’s wholesale gold demand was weaker than 2019 despite improvements after Q1 amid the significant reduction in the spread of the COVID-19 pandemic and its economic recovery
  • Au(T+D)’s average monthly trading volumes reached a record high last year
  • China’s gold ETF market kept expanding, attracting an inflow of 16t in the year. 

We expect gold demand in China to recover further in 2021 chiefly due to:

  • China’s economic recovery – which is expected to continue as policy support remains in place 
  • Stimulation of consumer markets – a priority positioned by Chinese policy makers for the coming years.

China’s gold consumption kept improving after Q1 amid the economic recovery and the containment of the COVID-19 pandemic

Market update: China's gold market in 2020

Sources: National Bureau of Statistics, World Gold Council; Disclaimer