Weekly Commentary - China domestic consumption is undercount
While Chinese visitors swarmed scenic spots around China during golden week holiday, economist regarded this is a good sign for Chinese economy.
The total number of domestic tourist over first two day was up 18.8%, even the growth was slightly slowdown from 21% last year. In addition, Chinese railroads carried 10.3 million passengers that were up 13.2% from last year.
Investors are cheering the strong tourist data because it signals that domestic consumption is very active. Economists widely believe that actual domestic consumption should be higher than National Bureau of Statistics reported. Because many purchases in China are made in cash and off the books. The strong tourist data indicated that China may be further along on the path to rebalancing than many expected.
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