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BIZCHINA / Center
Chinese consumer confidence rebounds
(Agencies)
Updated: 2007-07-26 16:30
The newly published China consumer confidence index (CCCI) by Xinhua
Finance eziData showed a slight rebound in Chinese consumer confidence in
July, as a jump in future expectations offset continued pessimism
regarding current conditions.
The index rose 0.4 point to 102.0 in July, but remained slightly below
the 102.2 reading in May.
The relative stability in July resulted from a series of sub-trends -
including steadily rising food prices, rebounding housing prices and
fluctuating stock market prices - that tended to counteract each other.
Current conditions fell by 1.2 points, the second consecutive monthly
decline, under the direct influence of rising concern on consumer prices
and lower stock market returns. More demand for cars was offset by an
even stronger increase in expectations of higher gasoline prices.
In contrast, future expectations rose 1.3 points, led by gains in both
the one-year business outlook (up 3.1 points) and five-year business
outlook (up 3.5 points). On the other hand, expectations on personal
finance in one year fell for the second month in a row (down 1.3 points),
affected by the declining sentiment on current personal finances.
The CCCI has fluctuated in the last few months due to concerns about sky
high real estate prices, the unstable stock market and confusing
post-Olympic economics. It's widely believed that such high real estate
prices are most likely to harm Chinese's economic in the long run, while
on the other hand, after the year-long unsuccessful government control on
prices, consumers have little hope that price will drop. The growing real
estate prices have destroyed confidence in local economic development
planned for the next five years.
Vacillating statistics from the past few months showed people with both
high and medium incomes were wary of the uncertainty of the Chinese
domestic market after the Olympics. Experts explained although most
people believed in a post-Olympics prosperous Chinese economy, they are
worried about the future development of some currently overvalued
industries such as the real estate sector.
Despite all the confidence in China's future economic prospects, people
feel less free to spend when they realize problems affecting current
economy, experts noted.
Xinhua Finance eziData China Consumer Confidence Index is a monthly index
designed and conducted by eziData and University of Michigan's Institute
of Social Research.
The survey this month was conducted through 1,546 telephone interviews
from July 1 to July13. April 2007 survey results are set as the benchmark
value of 100.
(For more biz stories, please visit Industry Updates)
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