Wages buoy consumer confidence
By Hu Yuanyuan (China Daily) Updated: 2014-07-22 07:30
Nielsen index maintains high level in Q2 as inflation gauge declines
Chinese consumer confidence remained high in the second quarter, thanks to average wage increases and a reduced consumer price index, Nielsen said on Monday.
The consulting firm said the confidence index stood at 111, marking the third consecutive quarter at this level and one point higher than a year earlier.
China's GDP growth also edged up in the second quarter to 7.5 percent from a year earlier, slightly higher than the first quarter's 7.4 percent, data from the National Bureau of Statistics showed on Wednesday. And HSBC Holdings Plc on Monday upgraded its forecast for the country's economic growth to 7.5 percent from 7.4 percent, saying recovery has been stronger than expected.
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The improved economic forecast for China, the US and parts of Europe will help boost consumers' confidence, but the direct driver is higher disposable income and a reasonable consumer price index, according to Patrick Dodd, managing director of Nielsen China.
"During China's ongoing transformation from an investment-to consumption-driven economy, per capita spending continues to grow due to increasing disposable income," Dodd said.
In the second quarter of 2014, Chinese consumers' willingness to spend reached 46 percent, 2 percentage points higher than in the previous quarter, according to Nielsen's findings. Meanwhile, their perceptions about personal finance increased one percentage point to 70 percent.
Last year saw a 14 percent jump in average pay for China's 269 million migrant workers, making it possible for them to spend more, said Dodd.
"These consumers share the same pursuits for a better and higher quality life as the existing middle class, and they will put their increasing disposable income to work to achieve these dreams," Dodd added.
Meanwhile, the CPI, the main gauge of inflation, moderated to 2.3 percent growth in June, down from 2.5 percent in May, NBS statistics showed.
