| Actual | Previous | Consensus | |
|---|---|---|---|
| Month over Month | 0.07% | 0.02% | |
| Year over Year | 7.6% | 5.5% | 7.0% |
Highlights
Chinese retail sales rose 7.6 percent on the year in October after growth of 5.5 percent in September, well above the consensus forecast for an increase of 7.0 percent. Sales rose 7.4 percent and 8.9 percent on the year in urban and rural areas respectively. The slightly later timing of national holidays this year compared with last year likely contributed to the strength in year-over-year growth. Sales rose 0.07 percent on the month after advancing 0.02 percent previously.
Other activity data published today show relatively steady year-over-year and month-over-month growth in October. PMI surveys and inflation data published earlier in the month also showed relatively steady but subdued conditions. Ongoing weakness in the property market, however, continues to weigh on overall activity. Officials characterised today's data as evidence that China's economy"sustained the good momentum of recovery" in October, with their assessment providing little indication that they believe substantial changes to policy settings are required.
Activity data published today were mixed relative to expectations, but the biggest miss was to the upside for retail sales. The China RPI and RPI-P rose from minus 64 to minus 21 and from minus 100 to minus 40 respectively, indicating that recent Chinese data in sum are continuing to come in below consensus forecasts.
Other activity data published today show relatively steady year-over-year and month-over-month growth in October. PMI surveys and inflation data published earlier in the month also showed relatively steady but subdued conditions. Ongoing weakness in the property market, however, continues to weigh on overall activity. Officials characterised today's data as evidence that China's economy"sustained the good momentum of recovery" in October, with their assessment providing little indication that they believe substantial changes to policy settings are required.
Activity data published today were mixed relative to expectations, but the biggest miss was to the upside for retail sales. The China RPI and RPI-P rose from minus 64 to minus 21 and from minus 100 to minus 40 respectively, indicating that recent Chinese data in sum are continuing to come in below consensus forecasts.
Market Consensus Before Announcement
After rising 5.5 percent in September versus expectations for 4.8 percent, year-over-year sales in October are expected to rise 7.0 percent.
Definition
Retail Sales measure goods that are sold to the consumer or end-user, generally in small quantities and in the state in which they were purchased by the retailer. China's retail sales are reported monthly. The critical value is the change from the same month in the previous year.
Description
Retail sales tend to have a muted impact because the Chinese economy is not heavily reliant on consumer spending. However, the government is trying to stimulate consumer spending to give the economy more balance. To this end, the government put into place a basket of stimulus measures, including government subsidies and tax breaks for home appliances and cars, to expand consumption to sustain the economic growth, which was slowed by a slump in exports amid the global economic downturn.
