Global art sales saw a decline of 4% last year, totaling around $65 billion, as ultra-wealthy buyers exercised more caution, revealed the Art Market Report released by Swiss bank UBS on Thursday, October 24. The UBS wealth management team, which advises clients on art acquisitions but refrains from classifying these purchases as investments, observed that inflation, high interest rates, and political uncertainty were prompting affluent clients to slow down and deliberate longer over potential acquisitions.
The report noted a 7% drop in auction sales volume and a 3% decrease at galleries, largely due to reduced demand for high-end artwork and overall lower average purchase prices. China was the sole country to experience growth in art sales, with a 9% increase bringing transactions to $12.2 billion, which positioned it as the second-largest art market worldwide, just behind the United States. UBS Global Wealth Management’s chief economist, Paul Donovan, attributed China’s growth to delayed post-COVID spending, as the country maintained isolation measures longer than its Western counterparts.
Donovan also highlighted that elevated interest rates and inflation had heavily impacted the more speculative art segments, particularly digital art, including NFTs. NFT sales, which hit a peak of $2.9 billion in 2021, dropped 51% last year compared to that high point. According to Donovan, they have not rebounded this year, even as interest rates began to ease and other asset classes, like cryptocurrencies, gained value.
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