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China retail sales slacken during New Year

Retail sales in China slowed during the Lunar New Year holiday and amidst the gift giving crackdown.

Data from the Ministry of Commerce shows retail sales grew 13.3 per cent to 610.7 billion yuan ($100.7 billion) from January 31 to February 6.

It represents the slowest pace of growth in about a decade.

Sales of luxury gifts and alcohol dropped 70 per cent and luxury restaurant sales by 20 per cent.

Meanwhile, sales of jewellery, mobile phones, computers and home appliances posted an increase.

“The government’s actions in curbing official spending and cooling the housing market are working to slow consumption, but I think underlying demand is still strong because wages are still growing at a robust pace,” said Alaistair Chan, an economist at Moody’s Analytics.

Imposed last year, the gift giving crackdown bans the use of public funds to buy luxury items.

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