Retail sales in China jumped more than expected last month, signaling that the world’s second-biggest economy may be weathering US tariffs.
June’s sales figures are expected to be higher still as China holds one of its main shopping festivals this week. Beijing has for decades faced calls to rebalance its economy away from manufacturing and into domestic spending.
However, “the suppressed [Chinese] consumer is a myth,” a top fund manager argued in the Financial Times: The real issue is that fast-growing private spending has been overshadowed by even higher growth in investment. “The country can’t solve the real problems caused by over-investment… by attacking the phantom problem of underconsumption,” he wrote.
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