2024-02-01 10:26:31 ET
Chinese investors are piling into %Gold as the country’s economy and stock market continue to slump, according to a new report from the World Gold Council.
Buying of the precious metal among Chinese investors and households is helping to support record prices for gold, which is viewed as a safe haven asset in times of market turmoil, said the World Gold Council.
The price of gold is currently at $2,058.50 U.S. per ounce, near a record high and up about 10% from a trough of $1,819.50 U.S. reached last October.
The World Gold Council said much of the support for gold can be found in China, where people have been buying the precious metal as local property, equity and currency markets drop amid a pronounced economic downturn.
Chinese investment demand for gold, which includes both bars and coins, rose 28% to 280 tonnes in 2023, even as global demand remained flat, said the World Gold Council in its report.
China’s main stock index declined by a fifth over the past year, while the value of new home sales dropped 35% year-over-year in 2023.
In a recent note to clients, analysts at %UBSBank (NYSE: UBS) said Chinese demand has been an “under-appreciated” factor driving gold prices higher.
Beyond China, gold prices have also been underpinned by strong buying among central banks around the world, led by China, Poland, and Singapore, said the World Gold Council.
The price of gold hit an all-time high of $2,135.39 U.S. per ounce in December 2023.