China Gold Market Update: Seasonal Demand Rebound and Gold Price Trends in Q1 2026
Gold Price Weakness in March Caps Q1 Gains
Gold prices fell in March 2026. Global markets cut both the LBMA Gold Price PM in USD and the Shanghai Gold Benchmark Price PM in RMB by about 11-12%. Q1 gains settled at a 7% rise. The drop came as investors eyed fewer Fed rate cuts amid inflation and unrest in the Middle East. Prices began to move up in early April. Investors then showed renewed hope.
Seasonal Rebound in China’s Wholesale Gold Demand
March saw a marked seasonal lift in wholesale demand in China. Withdrawals from the Shanghai Gold Exchange climbed 57% to 134 tonnes. Q1 totaled 345 tonnes. This marks a 3% rise from last year but still lags 23% behind the ten-year monthly average. More work days in March and post-Chinese New Year restocking by banks, refiners, and jewellers drove this pull. Although the jewellery side stayed weak, investment demand held overall consumption.
Continued Inflows into Chinese Gold ETFs
Chinese gold ETFs recorded strong inflows in Q1. Investors added RMB 59 billion (around US$8.5 billion) to these funds. Total assets grew to RMB 304 billion (about US$44 billion). Physical gold holdings increased by 50 tonnes to 298 tonnes. In March alone, inflows reached RMB 12 billion (US$1.7 billion), adding 8.4 tonnes to holdings. Safe-haven buying from regional worries helped maintain demand.
China’s Central Bank Accumulates Gold Holdings Amid Price Adjustment
The People’s Bank of China kept buying gold in March. It marked the 17th month of steady buying with an extra 5 tonnes. This monthly boost was the largest since February 2025. Total official holdings now reach 2,313 tonnes. Gold makes up around 9% of China’s foreign exchange reserves. In Q1, the bank added 7 tonnes despite the price drop in March.
Increased Gold Imports Kick Off 2026
In early 2026, gold imports in China rose sharply. January reached net imports of 77 tonnes and February had 96 tonnes, in contrast to last year’s net exports. Steady demand and a rising local gold price premium encouraged more importers to join the market.
Summary
- Gold prices dropped sharply in March 2026. Inflation worries and regional unrest led to fewer expected Fed cuts.
- Wholesale gold demand in China rebounded in March, though volumes lag behind long-term averages. Investment demand stayed strong as the jewellery sector stayed weak.
- Chinese gold ETFs posted record inflows in Q1. Both assets and physical holdings grew markedly.
- The People’s Bank of China kept buying gold steadily, boosting its official reserves amid market shifts.
- Gold imports in China surged at the beginning of 2026, showing clear signs of market strength.
Keywords: gold price, gold market, gold investing, gold bullion, gold news
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This article was generated by Hivebox AI in collaboration with nGRND.
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