Is China the World’s Biggest Goldbug?
Gold became Wall Street’s favorite punching bag after posting its worst annual performance in decades. Many investment firms providing coverage significantly lowered price targets, and headlines reminded investors on a daily basis just how terrible of a year it was for the precious metal. However, one of the most well-known goldbugs is not losing interest in the precious metal.
In 2013, China’s gold consumption surged 41 percent to 1,176.40 tonnes — exceeding 1,000 tonnes for the first time on record, according to the latest statement from the China Gold Association. Demand for jewelry was the biggest contributor, with an increase of 43 percent to 716.50 tonnes, while bullion demand rose 57 percent to 375.73 tonnes. China is the largest gold consumer in the world, followed by India.
Taking a cue from bargain hunters, Chinese gold demand did not diminish amid falling prices. Last year, gold plunged $200 in a matter of only two days during April and logged its worst one-day percentage drop since 1980. It was also gold’s largest decline in dollar terms on record. Gold even fell 5.5 percent in November, a historically a strong month of gains. By the end of 2013, gold fell 28 percent and posted its first negative year since 2000.