According to Iris Pang, Economist at ING, China’s retail sales growth is important to China as it reflects consumers’ appetite for spending, but retail sales grew weaker than expected at 8.6%YoY in October, down from 9.2% in September.
Key Quotes
“The slowdown is a surprise to us as October is a holiday month in China. Inbound tourism should not just bring faster growth of petroleum demand but also catering and other consumption items.”
“This makes us think that the fiscal stimulus from infrastructure is taking its time in arriving. And in the meantime, consumers have started to worry that the trade war will impact on wage growth and job security.”
“We hope that this will only be temporary as tax cuts for salary earners in 2019 should support spending sentiment in coming months, and spending on 11th November should indicate consumption is still growing well.”
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