China's consumption revival gathered pace in April as a closely watched barometer of retail sentiment crept further into expansion territory, with the country's targeted economic promotion policies drawing shoppers back to malls and markets.
The China Retail Prosperity Index, released on Sunday by the China General Chamber of Commerce (CGCC), edged up 0.3?point from March to 50.5. A reading above 50 signals expansion. The CGCC's website said that the uptick mainly stemmed from merchandise operations and leasing activities, reflecting stronger momentum after a raft of pro?consumption policies took hold.
Merchandise sentiment returned to growth at 50.1, helped by spring product roll?outs and wider trade?in subsidies, while the leasing sub?index climbed to a robust 52.7. E?commerce remained steady at 50.1, suggesting both online and physical channels see demand stabilizing, according to the CGCC.
The CGCC attributed the improvement to a newly issued action plan to boost consumption. The plan lays out measures to raise purchasing power, optimize the consumption environment, spur willingness to spend and resolve key bottlenecks.
With the help of spring consumption promotions, expanded trade?in allowances and emerging consumption scenarios, China's bricks?and?mortar retailers leveraged their in?store strengths and broadened sales, according to a CGCC commentary accompanying the data.
China's incremental fiscal policy is supporting the country's economic development. This year's Government Work Report pledged 300?billion yuan ($42?billion) in ultra?long special treasury bonds—double last year's allocation—to bankroll the nationwide trade?in campaign for cars, appliances and digital gadgets, Tian?Yun, a veteran Beijing?based economist. said on Sunday.
The larger bond envelope signals clear policy continuity and should unlock pent?up spending, especially in smart home devices and electric vehicles, Tian?said, adding that the growing momentum in consumption is likely to firm through mid?year as funds filter through to local governments and retailers.
Early numbers are encouraging. As of March 24, auto trade?in subsidy applications had topped 1.5?million, while consumers bought more than 28?million upgraded appliances and filed claims for subsidies covering 56?million digital products such as smartphones and tablets, Ministry of Commerce data show.
Other indicators underscored the pick-up. The National Information Center's offline consumption index rose 14.2?percent year?on?year in the first quarter, up 9.1 points from the previous quarter. Activity in small commodities, a barometer for day?to?day spending, jumped 16.3?percent in the first quarter, with March alone up 21.6?percent, reported CCTV news.
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