China’s retail sales in June stay above market expectations

Retail sales in China during the month of June stayed above market expectations, pairing with upbeat gross domestic product during the second quarter of this year. Also, industrial output remained in green that lent support to retail sales as well.

China's retail sales of consumer goods grew 10.3 percent y/y during the first half of this year, staying flat with the 10.3-percent growth in the first quarter, data released by the National Bureau of Statistics showed Friday. Moreover, total retail sales of consumer goods stood at 15.6 trillion yuan (USD2.2 trillion) in the first half of 2016, data showed.

In addition, retail sales in rural areas expanded by 11 percent y/y, outpacing the 10.2 percent rate for sales in urban areas. In June, retail sales of consumer goods grew 10.6 percent y/y, compared with 10-percent growth for May, NBS data showed. In the first six months, online sales surged by 28.2 percent y/y to 2.2 trillion yuan.

Retail sales have remained a significant factor in contributing to the transition that China is facing from an export-driven country to consumer-led economy. However, a mix of varied factors, such as rising salaries and subdued consumer prices, had supported growth in the first quarter.

Meanwhile, consumption contributed 66.4 percent to China's GDP in 2015, up 15.4 percentage points from 2014. Rural areas have significantly contributed to total retail sales due to a rise in online shopping. Some of the leading players in China’s e-commerce segment are Alibaba Group Holding (BABA), Baidu (BIDU), JD.com (JD), NetEase (NTES), and 58.com (WUBA).