China Gold Market Ends H1 2026 Lower Despite Strong ETF Inflows
Gold | 2026-07-15 07:00:15
Looking ahead, analysts expect jewellery demand to remain soft, while investment demand will depend on gold price movements and the Chinese equity market performance.
By Paul Ploumis
SEATTLE (Scrap Monster): China's gold market ended the first half of 2026 on a mixed note. The sharp fall in prices during June offset gains reported earlier in the year. The decline was driven by stronger U.S. dollar and higher bond yields.
Gold prices dropped around 11% during June in both international and Chinese markets. Over the first six months of the year, gold priced in U.S. dollars declined by 8%, while prices in Chinese yuan fell by 10%.
Chinese gold exchange-traded funds (ETFs) experienced their largest-ever monthly outflow in June, with investors pulling out nearly RMB15 billion (US$2.2 billion). The total value of ETF assets reduced to RMB243 billion (US$36 billion). Also, total gold ETF holdings fell by 17 tonnes to 277 tonnes.
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Chinese gold ETFs attracted net inflows of RMB40 billion (US$5.6 billion) during H1. This is the second-strongest first-half performance on record. Over the six months, total holdings increased by 29 tonnes.
China's wholesale gold demand improved from May to June, although cumulative demand for H1 stayed below the long-term average. Meanwhile, the People's Bank of China added 15 tonnes of gold to its reserves in June. During the initial six-month period, 40 tonnes were added to China’s official gold holdings.
Looking ahead, analysts expect jewellery demand to remain soft, while investment demand will depend on gold price movements and the Chinese equity market performance.
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Frequently Asked Questions
- Why did China's gold market weaken in June 2026?
Gold prices fell due to a stronger U.S. dollar and higher U.S. bond yields, leading to an approximately 11% decline in both international and Chinese gold prices.
- How did Chinese gold ETFs perform during June and H1 2026?
ETFs saw a record monthly outflow of nearly RMB15 billion in June, but still attracted RMB40 billion in net inflows during the first half of the year.
- How much gold did the People's Bank of China add to its reserves?
The PBOC added 15 tonnes in June, bringing total purchases to 40 tonnes during the first half of 2026.
