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On July 27, 2026, the World Gold Council (WGC) released its latest Global Gold Demand Trends report, showing that gold consumption demand in Asia reached 298.7 tons in Q2 2026, up 12% YoY, the highest for the period in five years. India and China, the two traditional gold markets, performed strongly, together accounting for 65% of the global gold consumption increase. Additionally, central banks in emerging markets such as South Korea, Thailand, and Indonesia continued to add gold reserves, pushing regional official purchases to a record high for the period.
India: Rural Income & Wedding Season Boost Gold Jewelry
The report stated that India's gold consumption demand in Q2 soared 18% YoY to 112.4 tons, with jewelry demand accounting for 78%. In rural India, abundant monsoon rains and expected agricultural harvest boosted farmers' incomes, coupled with strong demand during the traditional wedding season (Akshaya Tritiya), leading to a rapid recovery in jewelry consumption. Meanwhile, the Reserve Bank of India increased gold holdings by 6.5 tons in Q2, bringing total reserves to 825 tons, ranking 10th globally. Analysts believe domestic inflationary pressure (CPI at 5.8%) prompted investors to turn to gold as a store of value, while the slight depreciation of the rupee against the dollar also enhanced the appeal of gold priced in local currency.
China: Double Growth in Gold ETF and Physical Investment Demand
China's gold consumption demand in Q2 increased 9% YoY to 167.3 tons, with demand for gold bars and coins up 14% and gold ETF net inflows of about 12.5 tons. Despite high gold prices (international gold averaged about $2,350/oz in Q2), domestic stock market volatility and ongoing real estate adjustments drove safe-haven funds into gold. Wang Lixin, CEO of WGC China, said: 'Chinese investors increasingly view gold as a core part of long-term asset allocation, especially as central bank gold buying signals strengthen market confidence in gold.' Notably, the People's Bank of China did not announce gold purchases in Q2, but market participants speculated it continued buying through other channels.
Southeast Asia & South Korea: Central Bank Gold Buying Becomes New Driver
Asian central bank gold purchases totaled 98.3 tons in Q2, double that of the same period last year. The Bank of Thailand added 18.2 tons, bringing total reserves to 244 tons; the Bank of Korea added 12 tons, reserves exceeding 130 tons; Bank Indonesia also added 9.5 tons. These central banks stated that amid ongoing geopolitical uncertainty and challenges to the dollar's reserve currency status, gold as a non-sovereign asset effectively diversifies risk. Escalating tensions on the Korean Peninsula and civil unrest in Myanmar also prompted some private investors in the region to increase gold coin purchases.
Gold Price Outlook: Can Asian Demand Support New Highs?
As of July 27, spot gold was at $2,385/oz, up about 14% since the start of the year. The diminished expectation of a Fed rate hike in September (market pricing probability only 25%) combined with strong Asian physical demand provided dual support for gold prices. However, analysts warned that if the Fed unexpectedly turns hawkish or Asian central bank buying slows, gold prices could face a correction. Jake Lee, senior analyst at the World Gold Council, noted: 'The Asian market is shifting from a price taker to a price influencer, especially the consumption potential during festival seasons in India and China. In H2, Asia is expected to contribute over 50% of global gold demand.'
Industry Insights: Supply Chain Transformation & Market Structure Optimization
As Asian gold consumption upgrades, the industry chain is also transforming. In India, major jewelers like Titan and Malabar Gold are launching digital customization services, using blockchain to trace gold sources to meet young consumers' demand for transparency. Chinese gold brands are accelerating expansion into lower-tier cities, with brands like Zhou Liufu and Lao Fengxiang opening new stores through franchising in third- and fourth-tier cities. Additionally, the Shanghai Gold Exchange (SGE) announced it will launch a gold premium index futures in September, providing tools for hedging regional price differentials. In gold mining, giants like Barrick Gold and Newmont are adjusting production plans and increasing exploration investment in the Asia-Pacific region to meet future demand growth.
Overall, the structural rise of Asian gold demand is changing the rules of the global precious metals market. From central bank reserves to consumer spending, from ETF investment to jewelry craftsmanship, multi-layered demand provides a more solid floor for gold prices. Investors should focus on consumption data from India's Diwali and China's National Day holidays in the coming months, as well as subsequent gold purchase dynamics of the Bank of Korea and Bank of Thailand.
