Gold jewelry sales are finally picking up, but what about platinum?
Chinese jewelry sales are a key component of global demand for both physical gold and platinum, accounting for 14 percent and 16 percent of consumption respectively. But since 2013, the consumption does not seem pretty ideal.
This year, gold jewelry sales in number one market China are finally picking up after years of decline, while consumers are still shying away from platinum.
Reported in FuninUSA news, Chinese gold jewelry sales rose 7 percent in the first quarter, having climbed in 2017 after three years of decline brought on by a shift in consumer spending to other areas like foreign travel, and as luxury goods demand dried up in the face of a crackdown on graft, according to World Gold Council data. Early reports suggest Chinese platinum jewelry purchases fell by a similar degree in the first quarter, after extending a run of annual declines into a fourth year last year.
The reasons for the condition of platinum product consumption may be the concerns of price, history, and product itself according to FuninUSA news.
Chinese consumers, particularly in rural areas, do not have the strong cultural affiliation with platinum that they have with gold.
Besides, though platinum retails at a lower price than pure gold, making it attractive to younger buyers with less disposable income, these younger consumers are also favoring 18-carat gold, with a cultural preference for gold metal over white persisting.
Also, Jewelers charge a workmanship fee to exchange old platinum products for new of 32 yuan per gram, compared to 18 yuan for gold, which makes it harder for those consumers, who see jewelry as a source of ready cash, to recoup the original cost of a platinum piece.
A further drop in platinum jewelry sales may occur this year, and the picture is not necessarily much rosier for gold, in spite of its first-quarter increase, due to uncertainty about Chinese economic growth, showed in FuninUSA news.
