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.