Business Insider: "The Chinese seek refuge in gold"

Investors, households and China's central bank are buying gold for its safe-haven status as the country's stock market and housing sector continue to sink, writes Business Insider, citing a report published by the Financial Times.

According to the quarterly report of the World Gold Council (WGC), China's investment in gold bars and coins will increase by 28% to 280 tons in 2023. In terms of the global jewelry market, the demand from China for gold increased by 17%.

Globally as a whole, demand in the gold market fell 5% last year to 4,448 tonnes after strong growth in 2022. But in China the opposite has been the case, with both the population and even the government buying gold, according to Business Insider, citing data from the report.

China's central bank continued to buy gold, which helped the price of the yellow metal break the key $2,000 per ounce threshold. China's gold ETFs also saw sizable inflows as investors sought safety in the yellow metal, the publication noted.

"The attractiveness of gold has been accentuated by the growing need of households to protect value; the outstanding performance of the gold price caught their attention when the currency and other Chinese assets were weakening," another WGC report in January said.

According to Business Insider, the rush for the haven asset illustrates the uncertainty surrounding China's financial health. The stock market chaos sent the benchmark Shanghai Composite Index 300 down 5 percent last month and 23 percent over the past year.

In China's struggling real estate sector, Evergrande's debt saga continues as policymakers in Beijing step up efforts to limit the deepening of the crisis. In addition, China's economy has had a slow recovery from the Covid pandemic, with the authorities currently struggling to prevent deflation, stem the departure of foreign investors and the stock market decline.

By the end of last year, foreign investors had withdrawn 90% of their money invested in Chinese stocks, which are no longer attractive even to the Chinese, who started investing in Japanese stocks, writes Business Insider.