BEIJING May 16 China's consumers are cooling
towards discretionary spending, preferring to salt money into
savings or education for their children, according to a Nielsen
survey of Chinese consumer confidence published on Thursday.
Although Nielsen found that Chinese consumer confidence rose
in the first three months of 2012 to its highest since 2005,
making China the world's fourth most optimistic nation,
willingness to spend remained flat.
Savings and education were the only areas in which survey
respondents were more willing to allocate additional cash.
Willingness to spend on clothes, food, entertainment and
holidays all dropped compared with the previous quarter,
although higher than the first quarter of last year.
Recently released official data for April also showed a
slowdown in China's retail sales growth to 14.1 percent, the
lowest in 14 months and well below economists' expectations, hit
by a prolonged credit crunch in the property sector and flagging
demand from export markets.
Nielsen's previous quarterly survey had found that Chinese
consumers expected inflation to continue to stabilise in 2012.
Inflation in April eased to 3.4 percent year on year, from a
three-year peak of 6.5 percent in July 2011, according to
The latest Nielsen survey showed consumer confidence rose
the most in rural areas where remittances from migrant workers
are helping to boost spending power.
By contrast, confidence in China's wealthiest cities,
provincial centres and county seats remained flat. Only the
second-tier cities - which generally include the regional
economic centres - saw an uptick in confidence.
Urban consumers' outlook for China's overall economic state
was either flat or down compared with the previous quarter. Only
among rural consumers did the outlook tick up.
Nielsen, which provides data on consumers' spending and
viewing habits worldwide, surveyed 3,500 Chinese people from a
range of backgrounds.
Sales of quick-turnover consumer goods such as food and
personal care and hygiene products are rising at a faster rate
in rural areas, Nielsen found, as incomes rise and local markets
stock more goods.
But rural consumers only spend an average of 418 yuan
($66.16) a month on discretionary items, often during day trips
to larger towns with shops and markets, compared with average
monthly spending of 1,617 yuan a month by urban consumers.
($1 = 6.3182 Chinese yuan)
(Reporting By Lucy Hornby)