| Consensus | Consensus Range | Actual | Previous | |
| Month over Month | -0.48% | 0.14% | ||
| Year over Year | 2.0% | 1.8% to 2.2% | 0.2% | 1.7% |
Highlights
Chinese retail sales rose 0.2 percent on year in April, slowing sharply from growth of 1.7 percent in March and well below the consensus forecast for an increase of 2.0 percent. In month-over-month terms, retail sales fell 0.48 percent after a previous increase of 0.14 percent. Officials also adjusted their policy guidance today.
In their statement accompanying today's data, officials characterised the data as showing the economy has"maintained the steady and upward growth momentum". Although officials did not explicitly refer to the Iran conflict, they cautioned that the external environment is"complex and volatile" and again referred to an imbalance between strong supply and weak demand.
Officials today pledged to"implement a more proactive fiscal policy and an appropriately accommodative monetary policy", in contrast to the previous guidance which promised"more proactive and effective macro policies". This could indicate that changes to policy settings will be considered in the near-term, with the monthly review of the the loan prime rate later this week providing an opportunity for officials to make monetary policy somewhat more accommodative.
Market Consensus Before Announcement
A slight improvement is expected to 2.0 percent growth on year for April from 1.7 percent in March, still extremely weak for China.
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.