Baubles and bangles: the 'hard' sell in China's gyrating gold jewellery market
With spot gold swinging above US$3,500 an ounce before dipping, retailers are adjusting pricing daily to keep pace with market volatility.
Gold prices have been lurching this year amid gyrating trade and geopolitical tensions as investors and consumers seek a "safe haven" for their money. In late April, international bullion prices broke above a record US$3,500 an ounce. On Monday, the spot gold price was trading in New York at US$3,229.51.
In China, the world's biggest producer and consumer of the precious metal, the whiplash has rippled through the retail jewellery market. Last week, daily prices at major Chinese gold retailers slipped below the psychologically crucial level of 1,000 yuan per gram (US$138.60).
In the Yuyuan Garden bazaar area of Shanghai, gold necklaces were on sale for as low as 880 yuan per gram, triggering a brief wave of bargain hunting, with many buyers armed with government-issued shopping coupons.
"I got the discount voucher and saw the price dip," said a woman shopping for wedding bands. "I ended up paying a little over 600 yuan."
But if one side of the market is buying, the other is bailing. At a nearby goldsmith's workshop, the owner said his busiest trade last week was in gold recycling. On some days, he said, he has melted down over 400 grams.
"People were optimistic when prices surged," he said. "But now that it's dropped, they'd rather lock in their profit."
Zhou Zheng, an investment consultant, said the pullback in spending on gold was driven by fading risk sentiment.
"Trade tensions are easing, and geopolitical anxieties are less acute," he said. "After such a steep climb, profit-taking was inevitable."
Still, the broader forces behind gold's rally this year remain. Since late 2022, bullion prices have nearly doubled on stockpiling by central banks, on declines in the US dollar and on sticky inflation. Even as the market catches its breath now, few in the industry believe the story is over.
Changing product, not just pitch
The question now is not only whether gold is selling but what kind of gold is on the market.
On May 1, China's Ministry of Industry and Information Technology issued a national standard for so-called "hard pure gold" jewellery, formally codifying what had become the industry's tactical response to soaring prices.
Hard gold isn't new, but it is now officially defined: 99.9 percent pure, but hardened through a process that delivers lighter, hollow more sculptural pieces that retain size without weight.
In a gold jewellery market as avid as China's, signs of strain began appearing last year. Demand fell 25 percent from 2023 as surging bullion prices pushed everyday buyers to reconsider both quantity and form.
Still, China's appetite for gold hasn't disappeared. It's shifted. Retail interest has pivoted toward lighter, more flexible products, as consumers sought ways to reconcile tradition with rising costs.
"We're no longer talking about gold as heavy value,'" said Wang Lixin, regional chief executive officer for China at the World Gold Council. "We're talking about redesigning the product architecture to survive in a high-cost world."
That redesign begins with physics. Pure gold is naturally soft, requiring thick, heavy structures to prevent deformation. Traditionally, large-format pieces – bangles, pendants, wide rings – meant high weight, and thus, high cost. As prices soared, the industry re-engineered gold jewellery to forestall consumers from downsizing purchases.
As prices fluctuate, consumers are weighing design, affordability, and resale value, often choosing style over sheer weight.
Hard pure gold, developed through micro-alloying and new casting techniques, retains 99.9 percent purity while achieving far greater hardness. This enables hollow structures and more complex designs, especially those combining gemstones, engravings or thin-surface shaping, creating jewellery that looks larger, wears better and costs less.
That means a bracelet that would previously require 30 grams of gold can now be made with under 20 grams, cutting the retail price by one-third.
"The technology doesn't just lower material cost," Wang said. "It opens a creative frontier. You're no longer confined by the softness of the metal."
Until recently, these products lacked a formal definition. "Hard pure gold" was a marketing term, used loosely across brands with inconsistent claims about composition and performance. The new national standard sets baselines for hardness, labeling and purity testing.
For the World Gold Council, such standardization is critical in maintaining domestic quality control and eventual overseas international expansion.
"If Chinese brands want to compete globally, not just in price, but in design and engineering, we need common technical language," Wang said.
The standard also serves as risk mitigation. With high prices stretching consumer tolerance and manufacturers under pressure to reduce per-item gold weight, clear guidelines help prevent "over-innovation," such as compromised durability or unclear purity claims, that could erode trust.
More look, less weight
Many Chinese buyers are now tuning out the gyrations of daily gold prices and turning their focus to design and affordability. Younger consumers, in particular, are increasingly drawn to products that look substantial without being prohibitively heavy or expensive.
That shift is shaping how brands design, price and position their products.
"In light of gold-price fluctuations, many consumers prefer gold jewellery with lighter weight, without sacrificing product quality and contemporary design," said Xie Haoran, Southern Cluster General Manager of Chow Tai Fook Jewellery, China's biggest jeweler by market share.
"With hard gold and hollow techniques, we can reduce the weight of gold jewelry without compromising its size or three-dimensional form," he said at the grand opening of the brand's new image store in Shanghai.
Chow Tai Fook Jewellery has recently opened a new image store in Shanghai's downtown Nanjing Road E. as part of its ongoing retail upgrade.
Its Joie and Rouge collections combine traditional Chinese symbols with precision computer numerical control manufacturing. The brand's "thick-walled" hollow technique maintains a substantial look while significantly reducing weight, and cost.
Jewellery retailer Chow Sang Sang reports that more than half of its current jewellery sales come from hard gold.
"Buyer are more focused on design," said brand representative Ronnie Yao. "They like hard gold because it's lighter, more wearable and more affordable, and comes in fresher styles."
At Mingr jewelers, with a customer base concentrated in the 25-45 age group, demographics influence purchase choices. Older buyers still tend to prefer old-style gold, with heft, craftsmanship and traditional design symbolism, but younger customers tend to prefer pieces they can wear every day.
"They're practical," said Quan Lin, a marketing manager at Mingr. They want gold that's stylish, easy to match and not too heavy on the wrist or the wallet."
Global implications
The new standard on hard gold jewellery is expected to help the domestic industry expand abroad, particularly in Southeast Asia and the Middle East, where design trends are shifting toward lighter, more wearable forms, the gold council's Wang noted.
Still, exporting a material standard is complex. Each market has its own preferences, purity benchmarks and regulatory environment. Analysts say expansion will likely happen first in online commerce, where Chinese brands already dominate the middle to lower range of gold jewellery.
For the Chinese gold industry, the move may be less about this year's sales and more about the next cycle, when gold prices drop, competition returns and differentiation will matter more than momentum.
