Last Saturday, Israel launched an attack on Iran; however, the actual impact of this action on Iran was minimal. This situation has raised optimism that regional tensions may ease, thereby suppressing the demand for gold as a safe-haven asset. As a result, commodity prices such as crude oil, gold, and silver all opened slightly lower this morning, with the current spot gold price down by 0.45%. This week, a series of important economic data will be released, including the U.S. third-quarter GDP, October's Personal Consumption Expenditure (PCE) data, and the non-farm employment report. These figures will have a significant impact on the likelihood of future interest rate cuts by the Federal Reserve and the trend of gold prices.
As of the time of reporting, the international market price for gold was $2,740 per ounce, platinum was $1,019 per ounce, palladium was $1,190 per ounce, and silver was $33.37 per ounce. In Hong Kong, the price of gold was 25,352 Hong Kong dollars per tael, while the domestic gold quote was 623.4 Chinese yuan per gram.
The rise in gold prices has prompted some consumers to start paying attention to the investment field. Although the value of gold jewelry as an investment is limited, gold bars are more favored due to their investment value and have better sales.
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According to statistical data released by the China Gold Association, in the first half of 2024, the consumption of gold bars and coins achieved a year-on-year increase of 46.02%. At the same time, consumer enthusiasm for gold jewelry has significantly waned, with the consumption of gold jewelry in the first half of the year down by 26.68% year-on-year. For gold jewelry, gold is the main raw material. When the gold price rises slightly, consumers can still consider buying jewelry as an investment behavior. However, once the gold price rises above 700 yuan per gram, the price of gold jewelry far exceeds consumer expectations, leading to a sharp decline in sales.
As gold prices continue to rise, it seems difficult to find an investment variety more attractive than gold in the current market; moreover, gold bars are more cost-effective than gold jewelry because they do not require payment of processing fees. Most gold brand prices will be 20% to 30% higher than the international gold price, and gold jewelry needs to pay additional processing fees on this basis. The processing fees vary among different brands, and the price of gold jewelry is usually 60 to 100 yuan higher per gram than the gold listed price in the store. Under the current downturn in the gold jewelry consumer market, the profit space of gold shops has been severely squeezed.
Therefore, it is not surprising that gold bars are more popular than gold jewelry. Gold bars are relatively more convenient to cash out and will not depreciate significantly due to outdated styles or wear and tear. When recycling gold bars, there is no depreciation calculation. If sold by the same brand, they usually have a more complete recycling system, and the cash-out speed is faster than that of jewelry gold.
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