With the U.S. dollar-denominated gold price increasing over 5 percent since the beginning of March, the RMB-denominated gold price has also shot up as a result, catching wide attention of market participants.

The latest data from the Shanghai Gold Exchange shows that the price for gold that is 99.99 percent pure or above closed at 507.12 yuan per gram on March 15, up 5.4 percent from the closing price of 480.96 on Feb. 29.

Notably, the RMB-denominated gold price has been standing well above 500 yuan (about 70.4 U.S. dollars) per gram for seven consecutive trading days from March 7 to 15.

Gold jewelry price is also ballooning. In Chow Tai Fook, a well-known gold retailer in China, gold jewelry prices reached all-time pinnacles of 666 yuan per gram on March 11 and remained above 660 yuan per gram over the past few days.

"The skyrocketing price has contradictory effects on different gold buyers. While some remain bullish and continue buying, some adopt wait-and-see approach, and others decide to sell their jewelry at this moment," said Li Gang, a business department manager at the Beijing Guohua Jewelry store.

Liu Richeng, director of the futures department of Xiwang International Trade Co., Ltd., said that the underlying labor market conditions in the United States in February with the unemployment rate increasing to a two-year high of 3.9 percent, as well as relatively dovish comments from Fed Chair Jerome Powell have risen bets that the Fed could begin cutting rates sooner rather than later.

"If the U.S. Fed opens prospect of rate cuts, it would give a big welcome fillip to the gold price," said Liu.

Analysis from Everbright Futures notes that the strengthening of interest rate cut expectations in developed economies is an important driving factor behind the rise in gold prices, especially the similar stance of central banks in Europe and the United States.

A World Gold Council (WGC) report says that the recent gold price hike can be partly explained by a weaker U.S. dollar, an increase in market volatility and a drop in 10-year U.S. Treasury yields.

Besides, strong Chinese demand during the Spring Festival and the central bank's continuous buying spree also attribute to the gold rush since the beginning of 2024, said the WGC report.

"The recent gold price hike is much sharper than I expected. It is increasing too fast," said Song Jiangzhen, a senior researcher at Guangdong Southern Gold Market Academy.

According to a report by HSBC, the rapid increase of gold price is beyond fundamentals and the technical factor is likely to be the main driver. "Gold price in the short run is to some extent overheated and is likely to fluctuate within a range after excessive growth," said the report.