Chinese consumer confidence declined again in December to a new
low after a sharp fall in November, with sentiment hammered by
rising prices and weaker investment returns, said a report by
Xinhua Finance Ltd and eziData yesterday.
The China Consumer Confidence Index, compiled by the two
companies, fell 1.7 points in December to 97.2, the lowest level in
the short history of the survey, which started in April when the
benchmark value was set at 100.
Among major cities, Shanghai experienced the biggest decline.
Shanghai's consumer confidence index tumbled seven points to 92,
compared with a 2.2-point fall in Beijing to 97.2 and Guangzhou's
3.7-point drop to 93.2.
The survey was conducted through 1,547 telephone interviews from
December 2 to December 15 by Xinhua Finance Ltd, a financial
information and media service provider and eziData, a local China
consumer data provider.
In November, the index dropped by a record 1.9 points on the
back of soaring consumer prices and a correction in the domestic
stock market.
"The consecutive drops (in consumer confidence) are mainly due
to steadily rising prices as well as losses caused by the stock
market's decline" and "expectations of more government policies to
curb an overheated economy," said the report.
The Shanghai Composite Index, which tracks yuan-denominated A
shares and hard-currency B shares, fell below 5,000 points in
November from almost 6,000 points at the start of last month. The
index has been hovering around 5,000 points in December.
"The stock market's fall in November saw consumers turning
cautious about their investment decisions. That said, the
withdrawal of money from savings accounts, which had stopped last
month, restarted in December as rising prices saw higher household
spending," said the report.
China's consumer prices grew to an 11-year high of 6.9 percent
in November, which meant people had to allocate more money for
their family spending and less for investment.
(Shanghai Daily December 27, 2007)
