The MNI China Consumer Indicator increased, albeit marginally, for the first time infour months in April, led by a bounce-back in consumers’ optimism about their personal finances which offset a worsening in expectations for business conditions.
The Consumer Indicator’s rise to 91.6 in April from 91.4 in March left it at the highest since January.Sentiment, though, was down from the 94.2 reading registered inApril 2013, and has weakened noticeably since February amid growing concerns over the outlook for the economy and health of the financial system.
The relative stability in the overall MNI China Consumer Indicator masked significant changes in the sub-indicators, with a rise in the personal finance measures offsetting weakness in the outlook for business conditions.
Business Conditions in One Year and Five Years, as well as the Current Business Conditions Indicator all deteriorated in April, which augurs badly for economic conditions ahead given their strong correlation with official data such as industrial production.
In spite of the weak economic backdrop, the Car Purchase Indicator rose to 105.5 in April from 101.2 in March, the highest reading since October 2009, as an increasing number of households were willing to buy a car in the next twelve months.
Commenting on the data, Chief Economist for MNI Indicators Philip Uglow said, “While consumer sentiment remained broadly stable again in April it was still down from April 2013. Consumers are particularly worried about the current and future state of business conditions, and see little turnaround in the economy over the coming year.”
“There’s no stopping China’s love of cars, though, with our Car Purchase Indicator, which measures the strength of the auto sector, hitting a four and half year high,” headded.
