Driven by an unprecedented flood of capital into gold exchange-traded funds (ETFs) and record-breaking investment in physical bars and coins, China's gold demand surged to a record high in terms of value in 2025, according to a World Gold Council (WGC) report released on Thursday.

The WGC's report on global gold demand trends reveals that the world's largest gold consumer saw a dramatic shift in investor behavior as safe-haven demand intensified.

The Chinese gold ETF market experienced a landmark year, with cumulative inflows totaling 110 billion yuan ($15.2 billion) in 2025, it said.

Total assets under management (AUM) for domestic gold ETFs skyrocketed by 243 percent — ending the year at 241.8 billion yuan — while physical gold holdings backed by these funds soared to 248 metric tons.

The momentum peaked in the fourth quarter, which saw 51 billion yuan in inflows — the strongest single-quarter performance in the market's history.

While volume growth was steady, the total value of gold consumed in China reached new heights due to rising global prices, the council said.

China's total gold demand reached 1,003 tons, a 6 percent increase year-on-year and the highest volume since 2021. In monetary terms, demand hit an all-time high of 796 billion yuan, a massive 53 percent jump compared to 2024, it said.

According to the council, a sharp divide emerged between investment products and the jewelry sector as high prices impacted consumer choices.

Investment demand was exceptionally robust, with investors purchasing a record 432 tons of gold bars and coins, up 28 percent from the previous year.

Higher price tags dampened appetite for gold jewelry, with demand falling 25 percent to 360 tons. However, total spending in the jewelry segment still managed to rise 8 percent to 281.4 billion yuan, it said.

The WGC anticipates that the strong momentum for gold investment in China will likely persist into the first quarter of 2026.

Consumer demand is expected to find support from "self-reward" and gift-giving purchases ahead of the Chinese Lunar New Year. Additionally, safe-haven demand is projected to remain elevated throughout 2026, underpinning a continued steady outlook for gold investment in the region, it said.