China- Shanghai
Gold prices have witnessed in China an unprecedented surge recently, reaching record levels in both global and Chinese markets. On April 21, the spot price of gold in London surpassed $3,400 per ounce, while futures contracts traded on the Shanghai Stock Exchange reached 805.06 yuan per gram, the highest level ever recorded. Meanwhile, gold jewelry prices across China have jumped above 1,000 yuan per gram, as this upward momentum continues.
With the rising prices, gold shops have witnessed and specific decline, as consumers have clearly adopted a wait-and-see approach before making purchases. This surge, in turn, has stimulated the gold buyback market, as people have rushed to sell their gold to take advantage of the higher prices. In a number of major shopping malls in Beijing, buyback advertisements have become increasingly prevalent, with prices calculated based on the spot price of gold minus a 2% processing fee. On weekends, the Friday closing price is used as a reference.
A field survey of several gold shops and offline platforms revealed that differences of up to 50 yuan per gram may occur between different outlets due to different methods of calculating service fees, depreciation, and losses, despite all relying on the Shanghai Stock Exchange spot price as the primary reference.
Some banks have also entered the repo market. On April 21, the Industrial and Commercial Bank of China’s gold repo rate reached approximately 794.2 yuan per gram of 99% pure gold, reflecting the expansion of this market as individuals become increasingly interested in converting gold into cash at the height of the current bullion rally.
