(Yicai) Feb. 1 -- China became the world's biggest gold jewelry buyer last year, pushing aside India, after demand jumped 10 percent to 630 tons, despite higher prices of the precious metal.

Global demand for gold jewelry increased by three tons to 2,093 tons in 2023, supported by China's economic recovery, according to the Gold Demand Trends report published yesterday by the World Gold Council. 

Gold soared to a record USD2,078.40 per ounce last year, affected by geopolitical conflicts and the US interest rate hikes, the report said. The price in China jumped 17 percent, leading to a CNY282 billion (USD39.4 billion) increase in consumer spending on gold jewelry.

The surge in demand came thanks to the country's economic recovery, gold's increasing attractiveness, and growth in demand for jewelry at weddings, said Wang Lixin, chief executive of the World Gold Council's local branch. 

Consumer demand will likely weaken this year because of the rising gold price and other factors, Wang noted.

Global demand, including over-the-counter trading and other sources, hit a record 4,899 tons in 2023, according to the report.

Central bank buying kept up a breakneck pace, totaling 1,037 tons, down 45 tons from a record high in 2022. The People's Bank of China hiked its reserves by 224.88 tons to 2,235.41 tons, with the central bank raising its holdings of the yellow metal for the 14th straight month in December.

Global demand for gold bars and coins fell 3 percent in 2023, while demand in China surged 28 percent to 280 tons and offset the 59 percent decline in Europe, the report said. Demand in India, Türkiye, and the United States for gold bars and coins rose by 185, 160, and 113 tons, respectively. 

In addition to monetary policies around the world, uncertainty caused by geopolitical conflicts is also a key factor driving the gold price, said Louise Street, senior market analyst at the World Gold Council. That will continue have a major influence on the market this year, she pointed out.

Editor: Martin Kadiev