Asian gold markets rebound on strong retail buying in India and China

Gold prices saw a bounce-back in key Asian markets this week, trading at a premium in India and China for the first time in roughly two months, as a recent price correction from all-time highs spurred a revival in retail demand.

Indian dealers moved from offering a discount of up to $61 last week to charging a premium of as much as $15 per ounce over the official domestic prices this week, according to a Reuters report. 

This shift in pricing includes the standard 6% import and 3% sales levies.

Domestic gold prices were trading at approximately 136,700 rupees per 10 grams on Friday. This follows a record high of 140,465 rupees that was reached last week.

Improvement in retail purchases

A New Delhi-based jeweller noted a slight improvement in retail purchases this week, following a sharp correction in prices from their record-high levels.

The international benchmark spot gold market kicked off the New Year with remarkable strength on Friday, immediately resuming the vigorous rally that characterised the end of the previous year. 

This strong opening follows a monumental performance in 2025, during which gold prices soared by an astounding 64%. 

This substantial gain marked gold's most significant annual percentage increase since 1979, underscoring a powerful shift in investor sentiment toward the precious metal.

The continuation of the rally suggests that the underlying drivers of gold's historic surge remain firmly in place as 2026 begins. 

Analysts are pointing to a confluence of factors for the metal's resilience and attractiveness. Primary among these are persistent global geopolitical uncertainties, which typically drive investors toward safe-haven assets like gold. 

Furthermore, sustained inflationary pressures in key economies, coupled with an expectation of central banks either pausing or reversing aggressive interest rate hikes, make non-yielding gold a more appealing store of value. 

The market's move on Friday signals a widespread belief that the conditions which fueled the record 2025 gains—namely, economic instability and a search for tangible security—are set to persist well into the new financial year.

"Many buyers are holding off on purchases because prices are volatile and they're unsure which way the market is headed," a Mumbai-based bullion dealer with a private bank was quoted in the Reuters report.

China’s domestic market

In China, a leading consumer market, gold shifted this week from a discount to a premium of $3 an ounce over the global spot price benchmark, according to the report. 

This change was driven by strong retail demand and a significant correction in spot prices.

Independent analyst Ross Norman said:

According to Peter Fung, head of dealing at Wing Fung Precious Metals, the recent price volatility deterred customers. This was exacerbated by the thin trading volume typical of the end-of-year holiday season.

Gold prices varied across other Asian markets. In Singapore, gold was sold at a range between a $0.50 discount and a $1.20 premium per ounce. 

Hong Kong saw gold trade from par (at spot price) up to a $1.70 premium, while in Japan, bullion was sold exactly at spot prices (at par).