Soft Golden Week data in China bodes ill for retail sales
BEIJING (Reuters) – Tourism revenues in China during the Golden Week holidays that ended Thursday fell nearly 5% year-on-year, state media reported, as lingering coronavirus restrictions have also recorded a decrease in the total number of trips made.
The gloom in the data weighed on the outlook for China’s overall retail sales, which slowed much more sharply than expected when new outbreaks of COVID-19 hit a handful of Chinese cities over the summer.
The seven-day holiday in China from Oct. 1-7 to mark the national holiday is one of the country’s busiest travel times and an indicator of consumer demand in the world’s second-largest economy.
Domestic tourism revenues totaled 389.06 billion yuan ($ 60.36 billion), the official People’s Daily reported on Thursday, the last day of the holiday, citing data from China’s Ministry of Culture and Tourism.
It was down 4.7% year-over-year and still below 60% of income recorded the same week before the pandemic.
“The weakness in spending was due to relatively low prices for travel products and a move towards short-haul travel,” Citi wrote in a note.
“The recovery in consumption has been slow after the pandemic, and the road ahead can still be bumpy, given the lingering risks to public health. While the Delta wave has been contained, the risks of importing infections and local epidemics remain. “
RISKS TO GROWTH
The gloomy Golden Week data bodes ill for retail sales in October and adds downside risk to China’s economic growth outlook, Nomura said in a note.
Third quarter gross domestic product data is expected to be released along with September retail sales figures on October 18.
China has largely contained the spread of the coronavirus since it emerged in the central city of Wuhan in China in late 2019, taking a zero-tolerance approach that is becoming more costly economically due to business and industry disruptions.
The ministry also recorded 515 million domestic tourist trips through China in the seven days, representing a 1.5% year-on-year decline and just over 70% from pre-pandemic levels.
Flight bookings for the majority of popular tourist cities were slightly lower than a year earlier, China’s aviation regulator said on Friday.
Air passenger traffic during the holidays fell 19.6% from 2020 levels, according to data from the regulator.
($ 1 = 6.4452 Chinese renminbi yuan)
Reporting by Tom Daly, Stella Qiu and Ryan Woo; Editing by Gareth Jones