What happened
Given China’s real estate slump and deflation woes, Chinese investors are seeking a safe place to store their money. Enter gold, the precious metal that has been hitting historic highs in China and around the world.
But Chinese consumers aren’t just eyeing gold bars and coins. The topic “Hong Kong gold jewelry is ahead” (香港在金饰方面很超前) trended on Xiaohongshu this week as netizens shared pictures of cute and comical gold ornaments by Hong Kong jewelers, taking the form of croissants, sea cucumbers, har gow (shrimp dumplings), money bags, and durian.
Meanwhile, gold beans, weighing one gram and costing between $54 and $82, continue to be a popular entry point for young investors. The hashtag “gold beans” (#金豆) on Xiaohongshu has over 62 million views.
The Jing Take
When it comes to investing, there’s no time like the present. On March 8, the spot price of Au99.99 gold rose to 502.99 RMB ($70) per gram on the Shanghai Gold Exchange, surpassing 500 RMB per gram for the first time. This has since grown to 533.38 RMB as of April 3, pointing to the precious metal’s rally.
Many posts on Xiaohongshu encourage others, particularly women, to invest in gold as a safety net. “You don’t have to wear gold, but you can’t live without it,” writes Xiaohongshu Shubei Gold Strategy King (@水贝黄金攻略王). “If you are well, gold will accompany you until you grow old; if you are not, gold will be your life-saving straw.”
In 2023, gold consumption in China increased by 8.78 percent year on year to nearly 1,090 metric tons, according to the China Gold Association. During the 2024 Spring Festival, the sale of gold products spiked by 24 percent year on year, according to the Ministry of Commerce, and gold jewelry sales on both Tmall and JD.com more than doubled during the holiday season.
While this appetite is good news for jewelry makers, global brands should note Chinese consumer preferences. According to a 2023 jewelry report by Chow Tai Fook, 91 percent of survey respondents across mainland China and Hong Kong said they are likely to buy jewelry with elements of Chinese cultural heritage.
“With the resurgence of traditional culture and the advancement of technology, it’s possible to inject some good craftsmanship and elements into gold jewelry,” writes Xiaohongshu user Sister H (@H姐). “Not only does it retain its value, but it’s also very pleasing to the eye. People no longer consider gold outdated!”
Hong Kong brand Lukfook has nailed this look with its gold renditions of beloved Chinese food items, along with classier takes on Chinese fans, flowers, and other cultural symbols.
That said, the country’s slowing GDP growth and decline in marriages could dent demand for gold jewelry in 2024. Though expected to remain resilient, the World Gold Council predicts that China’s gold consumption will grow by just 1 percent in 2024.
But consumers are building up their collections gradually over time, playing the long game. Brands too should take this approach, looking ahead at China’s long-term jewelry potential.
The Jing Take reports on a piece of the leading news and presents our editorial team’s analysis of the key implications for the luxury industry. In the recurring column, we analyze everything from product drops and mergers to heated debate sprouting on Chinese social media.
