Retail / news
China Retail Sales Fall for First Time Since 2022
Retail sales of consumer goods in China dropped 0.6% year-over-year in May, the first decline since December 2022, as weak domestic demand weighed on the world's second-largest economy.
Data from the National Bureau of Statistics showed retail sales of consumer goods fell 0.6% in May compared with a year earlier, missing market forecasts and reversing a 0.2% increase in April. The decline highlights continued consumer caution amid a prolonged property crisis and uncertain economic outlook.
Between January and May, overall retail sales of goods and services rose 2.8% year-over-year, but growth was uneven. Services spending climbed 5.4%, while goods spending managed only a 1.2% increase. Discretionary categories, including fashion, were notably weak, according to the report.
Car sales extended their slump for an eighth consecutive month in May, and the impact of government trade-in programs for consumer goods appeared to fade. “Consumers aren’t as impulsive as they used to be,” said Jie’ao Feng, a Shanghai restaurant manager, in comments reported by Reuters.
In contrast, industrial production rose 4.5% year-over-year in May, accelerating from April’s 4.1% and beating expectations. High-tech manufacturing output rose 15%, driven by global demand for artificial intelligence investments. Industrial investment increased 4.5%.
The divergence between resilient industrial activity and lackluster domestic consumption underscores the imbalance in China’s economy, as exports continue to support factory output while households remain reluctant to spend.