Lowest growth in decade for China retail sales
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For the first time in 11 years, China retail sales growth has slipped below 10 per cent.
With market expectations of a 10.6 per cent rise, official data shows sales for the first two months this year increased by only 9.5 per cent.
The National Bureau of Statistics (NBS) attributes the slower growth to cooling auto sales, which fell 1 per cent from a year earlier after purchase tax for small cars was increased from 5 to 7.5 per cent this year. With the auto sales factor deducted, China’s retail sales expanded 10.2 per cent during the period, flat compared with the increase in the same two months last year.
Consumer goods retail sales totalled 5.8 trillion yuan (US$840 billion) during the period, NBS data shows.
There was strong consumption potential in rural areas, with retail sales expanding 11.8 per cent during the period, outpacing urban regions where sales were 9.2 per cent up.
However, online sales continued growing strongly, surging 31.9 per cent in the two months to 858 billion yuan.
As a main driver of economic growth, consumption contributed to 64.6 per cent of China’s GDP growth last year.
Questions & Answers
Q.What is the official retail sales growth figure for China for the first two months of this year?
What is the official retail sales growth figure for China for the first two months of this year?
Official data indicates that China's retail sales for the first two months of this year increased by 9.5 per cent. This figure is below the market expectation of a 10.6 per cent rise and represents the lowest growth in 11 years.
Q.Which specific sector is identified as a primary reason for the deceleration in retail sales growth?
Which specific sector is identified as a primary reason for the deceleration in retail sales growth?
The National Bureau of Statistics (NBS) attributes the slower growth primarily to cooling auto sales. These sales fell by 1 per cent from the previous year, following an increase in purchase tax for small cars from 5 to 7.5 per cent.
Q.How did online retail sales perform during the reported period compared to overall growth?
How did online retail sales perform during the reported period compared to overall growth?
Online sales showed strong growth, surging by 31.9 per cent in the first two months of the year. This resulted in a total of 858 billion yuan in online sales, significantly outpacing the general retail sales growth figures.
Q.Was there a difference in retail sales growth between urban and rural areas?
Was there a difference in retail sales growth between urban and rural areas?
Yes, there was a notable difference. Retail sales expanded by 11.8 per cent in rural areas, indicating strong consumption potential there. This growth rate outpaced urban regions, where sales were up by 9.2 per cent.