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China’s retail sales up 9.5% in first two months

Updated: Mar 14,2017 10:32 AM     Xinhua

BEIJING — China’s retail sales rose 9.5 percent year on year in the first two months of the year, missing market expectations of 10.6 percent, official data showed on March 14.

This was the first time for the growth to fall below 10 percent in 11 years.

The National Bureau of Statistics (NBS) attributed the slower growth to cooling auto sales, which fell one percent from a year earlier after the country raised purchase tax rates on small cars from 5 percent to 7.5 percent this year.

After deducting the auto sales factor, China’s retail sales expanded 10.2 percent during the period, flat compared with the increase registered in the same two months last year.

Retail sales of consumer goods totaled 5.8 trillion yuan ($840 billion) during the January-February period, according to NBS data.

The data showed strong consumption potential in rural areas, with retail sales expanding 11.8 percent during the period, outpacing that in urban regions, where retail sales climbed 9.2 percent from one year earlier.

Online sales continued strong growth, surging 31.9 percent in the first two months to 858 billion yuan.

China is trying to shift its economy toward a growth model driven more by consumer spending, innovation and services while weaning it off reliance on exports and investment.

As a main driver of economic growth, consumption contributed to 64.6 percent of China’s GDP growth last year. The country vowed to promote a steady increase in consumer spending this year.