China's Lunar New Year spending spree offers hope for consumption boost
Official statistics show China's domestic consumption was robust during the recently concluded Lunar New Year holiday, providing some positive signs for the country's economy as household spending becomes a greater priority in the absence of a more favourable environment for exports.
Consumer-related industries posted a 10.8 per cent increase in their average daily sales revenue during the eight-day holiday period compared to last year, official news agency Xinhua reported, citing data from the State Taxation Administration.
Spending on consumer goods and services during the annual holiday – which ended on Tuesday – rose 9.9 per cent and 12.3 per cent year-on-year, respectively, based on the administration's value-added tax invoice data. A nationwide trade-in policy for equipment and consumer goods, rolled out last March and still in effect, also appeared to have an impact. Sales of household audiovisual equipment surged 226.8 per cent year-on-year, fuelled by consumption subsidies.
'China's Spring Festival consumption data showed strong growth, driven by a surge in long-distance travel from the extended holiday period and front-loaded demand spurred by Beijing's 'trade-in' policy,' Changjiang Securities wrote in a note on Wednesday.
Consumers had been cutting back on spending after drops in asset values and slumps in the property and stock markets, with a 3.5 per cent year-on-year rise in retail sales reported last year – well below the pre-pandemic rate of 8 to 9 per cent.
China's tourism revenue climbed 7 per cent year-on-year to a record US$94.2 billion during the holiday, while domestic trips rose 5.9 per cent to 501 million, both all-time highs according to data released Wednesday by the Ministry of Culture and Tourism.
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