Strength in real estate and labor markets helped consumers in Chinaâ€™s biggest cities shrug off last yearâ€™s slowdown, according to a new survey based on 12,000 interviews.
RFi Groupâ€™s Urban Financial Sentiment Index rose to 101 in the second half of 2015, up from 92.5 in the first half. Readings over 100 show consumers say theyâ€™re optimistic about their financial positions, while those below indicate pessimism, according to the Sydney-based market research firm and financial data provider.
The gauge was above 105 in late 2013 and early 2014.
The findings show consumers remained resilient late last year even amid a $5 trillion stock plunge, yuan devaluation, and economic growth that slowed from 7 percent in the first two quarters of 2015 to 6.9 percent in the third and finally a six-year low of 6.8 percent. Such optimism is good news for policy makers working to shift toward a more consumer-led economy.
â€œConsumers remain fairly sheltered from developments in the industrial sectors of the economy,â€ RFi Senior Economist Amit Khan wrote in the report published on Tuesday. â€œThere is little correlation with the massive swings in Chinese stocks over the last 18 months.â€
The survey is based on interviews with consumers dating back to April 2013 in Beijing, Guangzhou, Tianjin, Shanghai and Shenzhen, and combines data on intentions to spend, save and borrow over the coming year. RFi plans to update the gauge every six months.
Khan cited property prices and labor markets as primary reasons consumers grew more optimistic. â€œIn the tier one cities such as Beijing, Shenzhen and Shanghai weâ€™ve seen a strong recovery in price growth, particularly in 2015,â€ he said.
The majority of those interviewed said that the stock market collapse, in which shares plunged by almost half from June to August, had a minimal impact on their net worth. Inflation was the biggest concern, with far fewer worried about unemployment.
Thirty percent of the respondents said they planned to spend more in the next 12 months.