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ANZ-Roy Morgan Chinese Consumer Confidence fell in January
January 20 2016
- Finding No.
Consumer Confidence Press Release
The ANZ-Roy Morgan China Consumer Confidence survey elicits respondents' expectations of inflation and prices. Data in January was collected from a sample of 1,000 Chinese aged 14+ (12,000 per annum) by telephone. The survey is conducted in metropolitan and outer urban areas - not only are 1st, 2nd and 3rd Tier cities included, but Tier 4 cities are also surveyed every month. The robust, representative sample is stratified geographically, with quotas controlled by gender and age.
ANZ Chief Economist for Greater China Li-Gang Liu said:
- ANZ-Roy Morgan China Consumer Confidence Index fell 1.9pts to 136.3 in January, from 138.2 last month.
- In terms of personal finances, 43.1% (last 40.3%) of respondents said that their families are ‘better off’ financially. Meanwhile, 17.8% (last 16.1%) said that they are ‘worse off’. On the outlook for personal financial situation, 53.8% (last 53.8%) expected their families to be ‘better off’ next year, compared with 8.7% (last 9.9%) who expected conditions to be ‘worse off’.
- On economic conditions, respondents who expect China to have ‘good times’ over the next year dropped sharply to 51.4% (last 60.9%), while respondents who expect economic ‘bad times’ increased to 22.3% (last 16.0%). On longer-term economic performance, 62.5% (last 62.1%) expect China to have ‘good times’ and 18.6% (last 14.9%) said that there will be ‘bad times’.
- In January, respondents who said that it is a ‘good time’ to buy major items increased to 45.9% (last 40.9%), while respondents who said that it is a ‘bad time’ to do so declined to 7.8% (last 10.4%).
- Inflation expectations edged down to 3.5% (last 3.6%) in January.
“The ANZ-Roy Morgan Chinese Consumer Confidence Index fell to a record low, coinciding with the lower-than-expected Q4 GDP growth in 2015. We find that respondents to the survey are increasingly pessimistic on the economy. Expectations for short-term economic outlook deteriorated sharply, as more people expect bad economic conditions over the next 12 months. Confidence on the five-year economic outlook also worsened in January.
"China is undergoing a debt-deflation led downward business cycle. During the process, conventional fiscal and monetary policy will gradually lose effectiveness in stimulating the economy. This means accelerating structural reforms is more urgent than designing plans to boost short-term growth.
"We forecast that China’s growth will slow to 6.4% in 2016, and hit the trough of 6.0% in 2017. A gradual rebound in growth could start in 2018, together with an upward property market cycle and political business cycle. It is still possible that China could achieve an average 6.5% growth during its 13th five year plan (2016-20) provided that the government takes decisive measures to tackle the highly indebted corporate and local government sectors in the coming two years.”
Click to view the latest ANZ-Roy Morgan Chinese Consumer Confidence Release PDF - January 2016.
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