Gold prices have entered a consecutive downward trend both internationally and domestically. As of March 17, prices had fallen for five straight trading sessions, with significant declines observed in the spot price of London gold and related products on the Shanghai Gold Exchange. While the persistent drop in gold prices reduces consumer purchase costs, market sentiment remains cautious, with many potential buyers adopting a wait-and-see approach. In response, several major gold jewelry brands have introduced promotions, including discounts on processing fees and trade-in programs, to stimulate consumer spending.

Over the past week, international and domestic gold prices faced notable downward pressure. The spot price of London gold fell from $5,077.94 per ounce on March 12 to around $5,010 by March 17, hitting a low of $4,966.12 during that period. Over five trading days, the cumulative decline exceeded 1.3%, with a single-day drop of 2.02% on March 12, equivalent to a more than $104 decrease overnight.

In the domestic market, gold spot deferred settlement products on the Shanghai Gold Exchange also experienced consecutive declines. On March 12, AU(T+D) opened at ¥1,148 per gram and closed at ¥1,146.26. By March 16, the closing price had dropped to ¥1,114.99 per gram, with a session low of ¥1,109.98. Over five trading days, the price fell by more than ¥31 per gram, representing a decline of approximately 2.7%.

The continued decline in gold prices has directly impacted consumer-side gold markets. Retail prices for pure gold products at major brands such as Chow Tai Fook, Lao Feng Xiang, and Chow Tai Seng fell from around ¥1,580 per gram on March 12 to between ¥1,542 and ¥1,557 per gram by March 16—a drop of over ¥30 per gram. Despite the lower prices, consumers have not rushed to buy; instead, many are holding off in anticipation of further declines. One consumer, Ms. Wang, noted that she is waiting for prices to stabilize before making a purchase.

Meanwhile, gold recycling prices also fell, dropping from ¥1,146 per gram to ¥1,116 per gram between March 12 and March 17. Another consumer, Ms. Gao, mentioned that when purchasing gold jewelry recently, she preferred to first buy gold bars from Cai Bai and then exchange them for jewelry through channels such as Pin Zhen Ge and Chow Tai Seng, as these outlets allow bar-to-jewelry exchanges without weight loss, requiring only a processing fee. This approach, she said, is currently the most cost-effective way to buy gold jewelry.

To stimulate end-user consumption, several gold brands have quickly introduced response measures, with a focus on processing fee discounts and trade-in promotions. For example, from March 19 to 21, select Cai Bai stores offered discounted processing fees for jewelry exchanges. Items originally purchased from Cai Bai qualified for half-price or even waived processing fees, while non-store gold jewelry enjoyed half-price processing fees for amounts up to 30 grams. Other brands have also launched promotions, such as brand-agnostic trade-ins, zero processing fees, and discounts of 30% to 50% on making charges, simplifying the exchange process and further reducing consumer costs.

Lin Xianping, an associate professor at Zhejiang University City College, suggested that gold brands are introducing trade-in promotions mainly to stimulate consumption, clear inventory, and enhance customer loyalty. Against the backdrop of falling gold prices and cautious consumer sentiment, such activities lower the threshold for purchase and attract customers holding old gold jewelry to make exchanges, thereby boosting sales.

However, Zhou Ting, dean of the Key Customer Institute, pointed out that both consumer hesitation and aggressive promotions by gold jewelers stem from a lack of confidence in future gold price trends. Consumers fear buying at a peak, while jewelers worry about stocking up at high prices. Under these conditions, both sides may develop an urge to clear inventory. If the current situation persists, it could easily trigger a chain reaction of sell-offs.

Zhou added that if prices continue to fluctuate at high levels in the near term, there is a significant possibility of further declines. The Key Customer Institute estimates that the most stable price range for gold in the future will be between $2,500 and $3,000 per ounce.

Lin Xianping advised that if buying for daily wear or essential needs, current promotions offer good opportunities, and consumers should consider their personal needs. However, for pure investment purposes, buyers should note that jewelry prices include processing fees and brand premiums, while recycling is typically based on raw material prices, making it less suitable for short-term speculation.

Gold prices are influenced by multiple factors, including U.S. dollar trends, geopolitical events, and inflation expectations. Lin noted that short-term volatility may continue, but over the long term, gold retains its value-holding function as a safe-haven asset during periods of economic uncertainty. As part of an asset allocation strategy, he recommended buying in batches to spread risk, while avoiding impulsive buying or selling based on price swings.