Chinese consumers are optimistic even in the aftermath of a Shanghai stock market rout and an economic slowdown. Consumer sentiment in China rose to its highest point in more than a year, according to Westpac MNI China Consumer Sentiment Indicator.
The reading of 118.2 was a 1.5 percent increase from August, the fourth straight month of improved sentiment and the strongest measure since May 2014.
Despite garnering international attention, the wild moves in China's major stock markets haven't fazed ordinary urban Chinese consumers, only 11 percent of whom identify themselves as owning equities. Instead, the loosening of credit restrictions and reforms to state-owned enterprises have preoccupied Chinese consumers, who are happy with the developments.
Fewer Chinese report spending more than 50 percent of their income on daily expenses, Westpac said in its report, while spending on leisure activities increased.
“Our cross-section of urban Chinese consumers seems oblivious to the tirade of negativity that surrounds China at the moment," MNI Indicators Chief Economist Philip Uglow said. "While China’s traditional industrial growth engine is slowing, the growing consumer and service sector should help to underpin growth in the months and years ahead.”
Meanwhile, China's slowing demand for imports in recent months has dragged global trade down and sent shivers of unease through financial markets around the world. Yet the measure remains only 1.7 percent below its long-term average, Westpac senior economist Matthew Hassan said.