Gold continues to hit all time highs ($2,946/oz). The recent World Gold Council report highlights a strong start to 2025 for gold, with both the LBMA Gold Price PM and the Shanghai Gold Benchmark Price PM experiencing significant gains. While wholesale gold demand in China improved month-over-month due to seasonal restocking ahead of the Chinese New Year, it remained weak compared to the previous year. Chinese gold ETFs saw outflows in January, attributed to profit-taking and improved investor risk appetite.
Despite ETF outflows, the People’s Bank of China (PBoC) continued to increase its gold reserves for the third consecutive month. Looking ahead, the report anticipates continued strength in bar and coin demand, while gold jewellery sales may be affected by soaring prices. A pilot program allowing Chinese insurers to invest in physical gold is expected to provide additional support for investment demand. Consumer interest in gold is surging, potentially stabilizing wholesale demand driven by investment purchases in the near term.
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