We know Egyptian pharaohs were buried wearing gold and the extremely wealthy in Ancient Rome donned it too. However, while many people look at gold as a safe-haven investment, gold jewelry remains a very important part of several cultures, often for reasons tied to its value as an investment.

In fact, jewelry represents the greatest demand for gold, followed by retail investment (bars and coins), the net official sector (central banks), and industrial fabrication.

Key Takeaways

  • Gold consumption for jewelry by China and India well outweighs that of other countries.
  • Jewelry-related gold demand in many countries is driven by traditions, such as wedding rituals.
  • Consumption across the major gold jewelry consuming countries did fall in the fourth quarter of 2019.

Below are the top 10 countries with the highest gold jewelry consumption for the fourth quarter of 2019.

Gold Jewelry Consumption Q4 2019

Rank Country Tonnes
1 India 136.6
2 China 132.1
3 U.S. 34.8
4 UAE 11.5
5 Indonesia  10.7
6 United Kingdom 10.3
7 Russia 9.1
8 South Korea 8.8
9 Iran 8.2
10 Italy 8.1

Source: GFMS Gold Survey 2019 H2 Update & Outlook

India and China continue to retain the top two spots when it comes to buying gold jewelry, according to figures published in the latest Thomson Reuters GFMS Gold Survey report. Jewelry consumption worldwide accounted for almost 46% of the total gold demand for the fourth quarter of 2019.

The World Gold Council, a market development organization backed by the gold industry, publishes a similar ranking, and while some of the figures differ, their top gold jewelry consumers ranking closely resembles that of Thomson Reuters and their analysts.

In the fourth quarter of 2019, India and China accounted for 57% of gold jewelry consumption globally. Jewelry demand from China accounts for more than a third of global demand.

India

India is the global leader in gold jewelry consumption. Jewelry consumption in India fell by 32% year-over-year in the second half of 2019. A quarter of the gold jewelry demand for the send half of 2019 was met by the exchange of old jewelry.

China

China is a close second when it comes to global gold jewelry consumption. Jewelry-related gold demand for China fell in 2019. Full-year 2019 tonnes demanded fell 8.6%, while in the second half of 2019, gold demand fell 9.7% year-over-year.

A decline in consumer spending has led to a pullback in gold jewelry consumption in China, said the Thomson Reuters report. The jewelry industry makes up more than 65% of the gold consumption in the country.

United States

The U.S. came in third for gold consumption in the quarter of 2019, though still well behind China and India. U.S. consumption has slowed due to rising gold prices.

Germany

Germany is the fifth largest consumer of jewelry gold in Europe, behind Turkey. The country consumed 5.4 tonnes in the fourth quarter of 2019. However, given the rising prices and economic slowdown, gold demand fell year-over-year for the country. Major reasons for the decline include the shift away from high-end jewelry toward technology and experience purchases.

Outlook

Overall, many major countries are expected to see declines in gold jewelry consumption due to elevated prices, which will keep "many potential buyers on the sidelines," said Thomson Reuters.