WGC China Gold Market Update: Physical Gold Demand Dropped

SEATTLE (Scrap Monster): The World Gold Council (WGC) published the latest edition of its China Gold Market Update.

The actual demand for the yellow metal decreased in May of this year, according to Ray Jia, Research Head, China World Gold Council. A seasonal 35% monthly decline in gold withdrawals from the Shanghai Gold Exchange (SGE) occurred throughout the month, reaching 99 tons.

In May 2025, the Shanghai Benchmark Gold Price PM (SHAUPM) in RMB saw a 1.4% decline, primarily due to the strength of the local currency, while the LBMA Gold Price PM in USD saw a slight decline of 0.7%.

ALSO READ:

WGC: Central Bank Gold Buying Decelerated in April

WGC Markets Monitor: Gold Prices Bounced During the Week

In the meantime, during the past month, the Chinese gold exchange-traded funds (ETFs) have lost $461 million. Since January of this year, this was the first monthly outflow. According to the WGC report, net holdings decreased by 4.6 tonnes to close the month at 198 tonnes, while total assets under management (AUM) fell to $21 billion.

For the seventh straight month, the People's Bank of China (PBoC) increased its gold holdings by 1.9 tonnes in May. At 2,296 tonnes, the central bank's gold holdings represent 6.7% of the nation's total foreign exchange assets.

WGC anticipates that Chinese demand for gold jewelry will continue to decline in the upcoming months. According to the statement, the investment pace can potentially slow down in the near future.