ALBAWABA – China’s domestic market is losing momentum, official and expert data indicates, as reported by news agencies Monday.
Domestic consumption and sales figures are scoring lower than average, both Bloomberg and Reuters have confirmed, hitting new lows since the COVID-19 pandemic hit China and the rest of the world.
Domestic travel spending during the Dragon Boat Festival holiday in China was lower than pre-pandemic levels, the Chinese Ministry of Culture and Tourism stated Saturday.
The holiday tourism data pointed to “fading post-Covid recovery momentum for in-person services,” according to Lu Ting, chief China economist at Nomura Holdings Inc.
Lu wrote in a Sunday research note, as reported by Bloomberg, that the average spending per trip was about 16 percent lower than in 2019.
“As pent-up demand fades and the risk of an economic double-dip becomes more real in coming months, we expect in-person services consumption growth to weaken further,” he added.
Weakness in mainland stocks continued as trading resumed after the holidays, with the CSI 300 Index sliding as much as 1.6 percent before paring some of the losses, Bloomberg reported.
Meanwhile, home sales in major cities were muted in the first few weeks of June and over the holiday period, the 21st Century Business Herald reported, as carried by Bloomberg. Whereas car sales in June are forecast to have dropped nearly 6 percent from last year, as shown in the preliminary estimates from China’s Passenger Car Association.
Nonetheless, any upcoming stimulus by the Chinese government is unlikely to be large in scale, according to Louis Kuijs, chief economist for Asia Pacific at S&P Global Ratings.
The firm cut its forecast for China’s 2023 gross domestic product growth to 5.2 from 5.5 percent, as per Bloomberg.
