China has surpassed India as the world’s leading consumer of gold in 2023, according to the World Gold Council (WGC). China’s demand for gold increased by 10% for jewelry and 28% for investment, while India saw a decline in demand for jewelry but an increase in investment.
China’s gold demand reached 959 tonnes, a 16% increase from the previous year, compared to India’s 781 tonnes. Notably, China is also one of the largest gold producers globally. The WGC highlighted that China’s robust economic growth has been a driving force behind this increase.
Overall global gold demand declined by 5% in 2023, with a total of 4,448 tonnes. However, when including over the counter trade and stock flows, total gold demand reached a record high of 4,899 tonnes. Central banks continued to buy gold at a rapid pace, with net purchases in 2023 just shy of the previous year’s record. Gold ETFs, on the other hand, experienced a third consecutive annual outflow, losing 244 tonnes.
The jewelry consumption market remained steady globally, with an annual consumption of 2,093 tonnes. China’s recovery in jewelry demand helped support the overall global consumption, despite the high price of gold. However, there was a decrease in the volume of gold used in technology, falling below 300 tonnes for the first time. Recycling of gold did not respond significantly to higher prices, with China being the exception.
India’s gold imports increased by 20% to 781 tonnes, raising concerns about the country’s current account deficit. However, gold recycling also rose by 20%, showing that consumers were hesitant to sell their gold due to high prices.
In the last quarter of 2023, gold demand decreased by 4% due to sharp price increases. China saw a 24% increase in gold demand during this period, while India experienced a 9% decline in jewelry demand. However, investment in gold increased by 18% in India, reflecting the confidence of consumers in the precious metal.
Despite high interest rates in the US and a bullish stock market, gold prices remained strong throughout the year. The future outlook for gold prices remains volatile due to geopolitical developments and global economic uncertainty, with India’s strong demand playing a significant role.
In conclusion, China’s rise as the top gold consumer in 2023 highlights its economic growth and increased appetite for both jewelry and investment. India, although displaced, still maintains a considerable demand for gold, particularly in the investment sector. Gold prices are expected to remain volatile, influenced by global economic factors and consumer demand.
Frequently Asked Questions:
1. According to the World Gold Council, which country has surpassed India as the world’s leading consumer of gold in 2023?
China has surpassed India as the world’s leading consumer of gold in 2023.
2. What was the percentage increase in China’s demand for gold for jewelry and investment?
China’s demand for gold increased by 10% for jewelry and 28% for investment.
3. How much was China’s gold demand in 2023, and what percentage increase is it from the previous year?
China’s gold demand reached 959 tonnes, a 16% increase from the previous year.
4. What was India’s gold demand in 2023?
India’s gold demand was 781 tonnes in 2023.
5. What were the key factors behind China’s increase in gold demand, according to the World Gold Council?
The World Gold Council highlighted that China’s robust economic growth has been a driving force behind the increase in gold demand.
6. How much did global gold demand decline by in 2023, and what was the record high when including over the counter trade and stock flows?
Global gold demand declined by 5% in 2023, with a total of 4,448 tonnes. However, when including over the counter trade and stock flows, total gold demand reached a record high of 4,899 tonnes.
7. What were the trends in gold purchases by central banks and gold ETFs in 2023?
Central banks continued to buy gold at a rapid pace, with net purchases just below the previous year’s record. Gold ETFs, on the other hand, experienced a third consecutive annual outflow, losing 244 tonnes.
8. How did China and India’s jewelry consumption and gold usage in technology change in 2023?
China’s recovery in jewelry demand helped support overall global consumption, despite the high price of gold. However, there was a decrease in the volume of gold used in technology, falling below 300 tonnes for the first time. China was an exception to the low recycling of gold in response to higher prices.
9. How did India’s gold imports and gold recycling change in 2023?
India’s gold imports increased by 20% to 781 tonnes, raising concerns about the country’s current account deficit. Gold recycling also rose by 20%, indicating that consumers were hesitant to sell their gold due to high prices.
10. How did gold demand in China and India fluctuate in the last quarter of 2023?
Gold demand decreased by 4% in the last quarter of 2023 due to sharp price increases. China saw a 24% increase in gold demand during this period, while India experienced a 9% decline in jewelry demand. However, investment in gold increased by 18% in India.
11. What factors influenced gold prices in 2023?
Despite high interest rates in the US and a bullish stock market, gold prices remained strong throughout the year. Geopolitical developments and global economic uncertainty also played a role in the volatility of gold prices.
Key Terms:
– World Gold Council (WGC): A market development organization for the gold industry that aims to stimulate and sustain demand for gold.
– Central banks: The financial institutions responsible for managing a country’s money supply, interest rates, and currency stability.
– Gold ETFs: Exchange-traded funds that track the price of gold and can be bought or sold on exchanges like stocks.
– Current account deficit: A measurement of a country’s trade in goods, services, and transfers with the rest of the world, indicating whether it is a net borrower or lender.
– Geopolitical developments: Factors relating to political power and relationships between countries that can impact economic and financial markets.
Suggested Related Links:
– World Gold Council
– Goldhub
– USAGOLD