To Hong Kong retailers, the latest China retail sales data is the subject of wild fantasys. But locals are unimpressed.
According to government data – which is often viewed with cynicism in the west – China retail sales rose 10 per cent year-on-year in October. But the financial press observed this was lower than forecasts from a Bloomberg News survey of economists, one describing the figure as “a worrying sign for domestic demand in the world’s second-largest economy”.
That’s a marked difference to the 4.1 per cent fall in retail sales in Hong Kong recorded in September.
Further data from China’s National Bureau of Statistics (NBS) showed October’s industrial output growth matched the previous month’s figure at 6.1 per cent, also slightly below expectation.
NBS spokesman Mao Shengyong said the slowdown in consumption growth was due mainly to a higher base of comparison last year as automobile sales surged thanks to government tax cuts.
Hong Kong-based analyst Andrew Collier said the figures could be an indication consumer participation in China’s growth is declining.
“It’s harder for the government to control retail sales than (fixed-asset investment or industrial production, which is heavily state-driven,” he said.
China’s government has boosted fiscal stimulus and loosened credit to try to keep the economy growing within its target band of 6.5 to 7 per cent for the year.