China’s May Retail Sales Growth Hits Highest Since December 2023 – NBS: More Policy Tools in Reserve

TradingKey - According to the National Bureau of Statistics on June 16, China's total retail sales of consumer goods in May rose 6.4% year-on-year to reach CNY 413.26 billion, marking the fastest growth since December 2023. This reflects the positive impact of policies such as old-for-new appliance upgrades and the easing of U.S.-China trade tensions on consumption.

Retail sales excluding automobiles rose 7.0% year-on-year to CNY 373.16 billion. In the first five months of the year, total retail sales grew 5.0% year-on-year to CNY 2,031.71 billion, while non-auto retail sales increased 5.6% year-on-year to CNY 1,843.24 billion.

China Retail Sales Growth, Source: National Bureau of Statistics

Policy Support Drives Growth

Bloomberg economists noted that government-backed old-for-new appliance and electronics replacement programs have contributed significantly to the rise in retail sales.

Analysts believe that to sustain this positive momentum in retail spending, the Chinese government may introduce further stimulus measures in the second half of the year.

Goldman Sachs added that with actual GDP growth in the first half likely exceeding the annual target of 5%, the urgency for large-scale stimulus in the near term has somewhat diminished.

Economic Resilience Seen Across Indicators

On Monday morning, Fu Linghui, spokesperson for the National Bureau of Statistics, commented on the operation of China’s economy in 2025 during a press briefing. He stated that economic activity remained generally stable in May, with some key indicators continuing to improve, new growth drivers strengthening, and high-quality development continuing — highlighting the resilience and vitality of the Chinese economy.

Fu emphasized that China has implemented more proactive macroeconomic policies this year, intensifying counter-cyclical adjustments. The policy toolkit for the second half remains robust, with ample room for further macroeconomic support to ensure continued economic stability and growth.