China consumers upbeat on inflation, incomes, says survey
BEIJING, March 9 — China’s consumers are among the world’s most confident, buoyed by expectations of rising income, lower inflation and solid job prospects, according to a private survey published today.
Rural Chinese consumers were particularly upbeat, but their willingness to spend was constrained by concerns that income would not keep up with costs of health care and food, according to the quarterly survey by information company Nielsen.
“As inflation stabilised and dropped to its lowest level in December 2011, consumers had more disposable income in their wallets and reignited their discretionary spending across most sectors,” Karthik Rao, Nielsen Greater China managing director, said in a statement accompanying the survey.
today, China published retail sales data which showed growth in the first two months of 2012 was slower than economists had expected. Sales for the two months combined — to smooth out the distortions of China’s Lunar New Year holidays — were 14.7 per cent above a year earlier, compared with a forecast of 17.5 per cent in a Reuters poll.
Also today, official data showed China’s annual rate of inflation cooled to 3.2 per cent in February, the first time it has been below four per cent since September 2010, after running above the government’s target in every month of 2011.
The Nielsen survey found that Chinese consumers expect inflation to continue to stabilise in 2012, with 30 per cent of the survey’s respondents expecting overall prices to remain the same or decrease in 2012 compared to 17 per cent in the same period a year earlier.
Nielsen’s quarterly survey of 56 economies around the world found that Chinese consumers topped its global rankings in the fourth quarter for discretionary spending on out-of-home entertainment, technology and stock market investing.
They were second only to Russian consumers for discretionary spending on new clothes.
The survey canvassed opinions from more than 3,500 Chinese consumers across the social spectrum from rural households to those in the top tier cities.
Coastal cities had the highest optimism reading, followed by the central region. Confidence in the western part of China rose to narrow the gap with other areas.
Rural consumers were China’s most confident about employment and income prospects. Consumers in tier one cities were the most willing to spend.
Differences in concerns prevailed across the different areas. Income was the main concern for 72 per cent of rural consumers, followed by health. In cities, income and health were also the top concerns.
“Rural Chinese consumers and their counterparts in lower tier cities enjoyed high confidence through the year, however their willingness to spend (was) still low (compared with) consumers in key cities,” Rao added.
Overall, Chinese consumers were the sixth most optimistic worldwide, the survey found. — Reuters