China Consumer Confidence Inched Up in June with Eased Price Rises and National Cohesion...

China Consumer Confidence Inched Up in June with Eased Price Rises and
National Cohesion Developed from Earthquake Rescues

SHANGHAI, China, June 24 /Xinhua-PRNewswire/ -- Xinhua Finance eziData
China Consumer Confidence Index (CCCI) was updated today, with the survey
results showing that although Chinese people in June were faced with a series
of negative factors such as continuous aftershocks of the Wen Chuan
earthquake,
the financial crisis in Vietnam, and a re-falling stock market, consumer
confidence did not fall but inched up by 0.2 point to 95.1. The stabilization,
even slight improvement in the overall consumer confidence was largely due to
the following two factors: continuously easing general price rises which
helped raise consumer sentiment on current conditions, and the earthquake
rescues in the last few weeks which encouraged patriotism among average
Chinese consumers and made them more enduring when facing the difficulties
ahead. In August 2005 when the United States was hit by Hurricane Katrina,
consumer confidence of the University of Michigan showed a 12.2 fall in the
following month.
Xinhua Finance eziData China Consumer Confidence Index
(Baseline survey: April 2007 = 100
http://www.xinhuafinance.com/en/charts/indicator/ccci/ccci0806_en.jpg

Under the support of the Xinhua Finance family, Xinhua Finance eziData
China Consumer Confidence Index is produced monthly by eziData, a local
provider of China consumer data, and in association with Dr. Richard Curtin.
Dr. Curtin is Research Professor and Director of the Consumer Sentiment
Surveys at the University of Michigan's Institute of Social Research. The
survey this month was conducted through 1,554 telephone interviews from June 1
to 18, 2008. April 2007 survey results are set as the benchmark value of 100.
More on the survey methodology can be found in the accompanying section.
In June, consumer sentiment on current conditions rose by a strong 2.5
points from the previous month as general price rises continued to ease with
the seasonal price falls with vegetables and fruits. Sentiment on both current
personal finances and durable goods purchases rebounded. In terms of future
expectations, though the recent financial crisis in Vietnam had triggered
concerns on whether China could continue its economic development in the time
ahead, consumers' future expectations index performed relatively well and fell
only a modest 1.2 points in June, due to an enhancement in overall national
confidence developed from the earthquake rescues. Among all components of the
future expectations index, expectations on business conditions five years from
now declined only 0.5 point, indicating that confidence still exists among
consumers in the long term economic development in China. In contrast, after
Hurricane Katrina at the end of August 2005, the September consumer confidence
survey of the University of Michigan showed a 10.1-point drop in consumers'
sentiment on current conditions and an even sharper 13.6-point fall in that on
future expectations.
As the Olympics approach and negative factors such as inflation seem to be
controllable within a certain period, the eziData analyst believes that
consumer confidence is not likely to fall much in the next couple of months
but should stabilize or rise back.
Although the Shanghai Composite in June went all the way down to break
3,000 points, consumer confidence in stock investment did not collapse but
stagnated at low levels. Consumer sentiment on expectations of stock
investment returns in the next twelve months remained unchanged from the
previous month. However, it is perceived that the stagnation at low levels
caused by investors' hesitation and wait-and-see mindset may not last long. If
the Shanghai Composite could not rise back to a level above 3,000 points, it
is very probable and the expectations on stock investment in July will fall.
Although consumer expectations of future price changes kept rising for
several days following the Wen Chuan earthquake news in May, expectations in
June did not follow the same trend but remained at the same level as in the
last month, indicating that the impact on general prices by the earthquake so
far was only about psychological expectations and has not constituted a real
impact on the economy.
In terms of major cities, consumer sentiment in June rose in Beijing and
Guangzhou, but fell in Shanghai.
Encouraged by an easing in the general price rises and inspired by the
upcoming Olympics, consumer confidence in Beijing surged a full 9.9 points in
June to 99.2 after a 5.9-point drop in the previous month, getting back to the
level of January and becoming the highest reading among all three cities
again.
All five components of the overall confidence rose, with current personal
finances surging.
Sentiment among Shanghai consumers performed poorly in June, as a drop in
future expectations failed to offset a rebound in current conditions and
dragged the overall confidence down by 2.3 points, which was the second drop
in a row following the May decline. And among all five components of the
consumer confidence index, current personal finances rose and durable purchase
intentions remained basically unchanged, while all three components of future
expectations fell, especially the five-year business outlook which had been
rising in April and May.
Consumer sentiment in Guangzhou rose another 0.8 point in June following a
rise in May. Sentiment on current conditions rose, with that on both current
personal finances and durable goods purchases surging. Future expectations
fell, mostly due to a significant fall back in the one-year personal finances.
To find more about CCCI or subscribe to a full version of the survey,
please contact us via info@eZiData.com
Methodology
Xinhua Finance eziData China Consumer Confidence Index is produced in
association with Dr. Richard Curtin, Research Professor and Director of the
Consumer Sentiment Surveys at the Institute of Social Research, University of
Michigan. The index is based on a monthly survey of around 1,500 Chinese
households via stratified random sampling in 50 representative cities across
East, Middle and West China using the same methodology as is used by the
University of Michigan. All data is collected via computer assisted telephone
interviewing (CATI). Index of April 2007 survey is set as the benchmark (100).
Notes to editors:
About Xinhua Finance Limited
Xinhua Finance Limited ("XFL") is China's premier financial information
and media service provider and is listed on the Mothers Board of the Tokyo
Stock Exchange (symbol: 9399) (OTC ADRs: XHFNY). Bridging China's financial
markets and the world, Xinhua Finance's proprietary content platform,
comprising Indices, Ratings, Financial News, and Investor Relations, serves
financial institutions, corporations and re-distributors worldwide. Through
its subsidiary Xinhua Finance Media Limited (Nasdaq: XFML), XFL leverages its
content across multiple distribution channels in China including television,
radio, newspaper, magazine and outdoor media. Founded in November 1999, XFL is
headquartered in Shanghai, with offices and news bureaus spanning 12 countries
worldwide.
For more information, please visit http://www.xinhuafinance.com .
About eziData
eziData is a local provider of China consumer data, serving both financial
and consumer market participants. It aims to serve global and local business
professionals with decision-making tools that relate to consumption in China
and conform to international standards. eziData's comprehensive portfolio of
high-quality consumer data products, which includes a structured real-time
databank, delivers a broader and more insightful view of the market. For more
information, please visit http://www.eziData.com
For further information, please contact:

Xinhua Finance
China:
Ms Joy Tsang
Tel: +86-21-6113-5999
Mob: +86-136-2179-1577
Email: joy.tsang@xinhuafinance.com

Mr. Scott Zhang
Tel: +86-21-6113-5996
Email: scott.zhang@xinhuafinance.com

SOURCE Xinhua Finance Limited

Ms Joy Tsang of Xinhua Finance Limited, tel, +86-21-6113-5999, or mobile,
+86-136-2179-1577, or email, joy.tsang@xinhuafinance.com; Mr. Scott Zhang of
Xinhua Finance Limited, +86-21-6113-5996, or scott.zhang@xinhuafinance.com