- According to the latest data disclosed by the China Gold Association (CGA), in the first quarter of 2026, China's domestic gold consumption reached 303.292 tons, an increase of 4.41% year-on-year. Among this, the consumption of gold bars and coins surged by 46.40% year-on-year to 202.062 tons.
- During the same period, domestic gold jewelry consumption recorded 84.620 tons, a year-on-year decrease of 37.10%. The high and volatile international gold prices significantly suppressed terminal discretionary consumption demand, prompting funds to shift towards physical gold bars with investment and savings attributes.
- On the supply side, affected by concentrated safety inspections and shutdowns for maintenance at mines and refineries, domestic raw material gold production in the first quarter decreased by 7.08% year-on-year to 81.065 tons. Meanwhile, official reserves increased by 7.15 tons in a single quarter, reaching a total scale of 2313.48 tons, elevating its global ranking to fifth place.
Divergence in Terminal Consumption Structure
The domestic gold retail market is currently undergoing a profound structural reshaping. The core feature of the first quarter consumption data is the extreme divergence of "cold jewelry, hot gold bars." The consumption of gold bars and coins surpassed the 200-ton mark, with a year-on-year growth rate of nearly 50%, reflecting the defensive tendency of the household sector in asset allocation. Against the macro backdrop of international gold prices repeatedly hitting new highs and increased intraday volatility, the high premium attribute of gold jewelry (including processing fees and brand premiums) significantly deters price-sensitive consumers. In contrast, investment gold bars sold through bank channels, due to their proximity to the basic gold price and high transaction transparency, absorbed a large amount of risk-averse funds spilling over from the jewelry sector, becoming the core engine supporting the overall positive growth in gold consumption in the first quarter.
Supply-Side Capacity Disruptions
While the demand side is expanding in total, the domestic gold supply side is facing a phase of capacity contraction. The first quarter saw a reduction of 6.178 tons in domestic raw material gold production, mainly due to industry-wide top-down hidden danger investigations and safety inspections. Some small and medium-sized mines and refineries underwent shutdowns for maintenance due to environmental and safety compliance requirements, directly dragging down the quarterly capacity release rate. This phase of rising compliance costs has led to a tight balance in the domestic spot market's supply-demand structure. If the subsequent resumption of production progresses slower than expected, coupled with the pre-stocking demand for the traditional consumption peak season in the second quarter, the premium of domestic spot gold relative to the international benchmark price may remain at a high level in the short term.
Central Bank Gold Purchases and Pricing Anchors
The continuous expansion of China's official reserves provides solid macro support for the bottom pricing of the global gold market. In the first quarter, China increased its gold holdings by 7.15 tons, pushing the total reserves to 2313.48 tons, elevating its rank to fifth in the global official gold reserves. This systematic increase is not only aimed at optimizing the structure of the foreign exchange reserve balance sheet but also sends a message to the market about the sovereign credit's long-term preference for physical assets. In the macro context of frequent global geopolitical frictions and the expansion of debt scales in major economies, the gold purchasing behavior of the People's Bank of China (PBOC) and other major global central banks is substantively altering the traditional pricing logic of gold, increasingly highlighting its role in hedging against the dilution of dollar credit.
