China Consumers Not Buying Enough Goods

Retailers and policymakers have high hopes for consumer spending in China driving profits and economic growth. And while on the rise, consumption is not getting there as fast as many had hoped, industry watchers say.

China is trying to rebalance its economy away from investment and exports towards consumption, which Beijing hopes will deliver more stable long-term growth for the world’s second-largest economy.

The problem, say strategists, is that China’s consumers remain elusive.

“China is still sitting there with the lowest consumption to GDP [gross domestic product] ratio in the region. Consumption is 35 percent of GDP and is a good 25 percentage points from where it should be,” said Paul Gruenwald, chief economist, Asia Pacific at Standard and Poor’s Ratings Services.


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Mingze Wu

Mingze Wu

Currency Analyst at Market Pulse
Based in Singapore, Mingze Wu focuses on trading strategies and technical and fundamental analysis of major currency pairs. He has extensive trading experience across different asset classes and is well-versed in global market fundamentals. In addition to contributing articles to MarketPulseFX, Mingze centers on forex and macro-economic trends impacting the Asia Pacific region.
Mingze Wu