Consumer Confidence In China Declines for Fifth Straight Month

Tuesday, February 10, 2009 21:20
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While many may believe that the key to pulling out of the current crisis we find ourselves in is China’s 1.3 billion consumers, the Shanghai Daily is reporting that Consumer mood declines again:

The sentiment index settled at 87.3 last month, down from 90.2 in November and 92.4 in October

For those of us in China, it was clear that the Chinese New Year was a slow one, so it will be interesting to see how the numbers come in. Sure, the CNY season was 13% up from the year before, but given half the country did not have electricity, the real impact of this number is likely to show a negative.

Will the governments subsidies do the trick?
What will consumers do should layoffs continue?
Will they save more?

These are all questions a lot of people are asking right now, and it does not look encouraging.

In their recent release, while consumer confidence or spending are not explicitly mentioned, UBS’s current believe is that while the economy is showing signs of a rebound that the missing link is related to real estate:

let’s not get too excited about the word “vibrant” just yet; we have yet to see convincing signs of stabilization in the one area that matters most, i.e., property and related construction, and until we do markets could well be stop-and-go.

Which might explain why Vanke is now dangling goodies to lure new home buyers

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