China Retail Sales Growth Unexpectedly Slows

China’s retail sales rose 0.6% year-on-year in July 2026, slowing from 1% growth in June and falling well short of expectations for a 1.5% increase. Weak big-ticket spending continued to weigh on consumption, with automobile sales plunging 17.0%. Excluding automobiles, retail sales rose 2.5%. Sales also declined for petroleum products (-7.6%), furniture (-8.8%), and building materials (-14.2%). In contrast, communication equipment sales jumped 20.4%, while tobacco and alcohol rose 6.0%, cosmetics increased 6.8%, and food products gained 5.3%. By segment, catering revenue increased 1.4%, while retail sales of goods rose 0.5%. Online retail sales of goods increased 4.6% in the first seven months. On a monthly basis, retail sales rose 0.06%, following a 0.35% gain in the previous period. From January to July, total retail sales rose 1.2%, while sales excluding automobiles increased 2.7%.

China’s retail sales rose 1.0% year-on-year in June 2026, rebounding from a 0.6% decline in May and defying market expectations of a 0.1% fall. Communication equipment sales jumped 16.5%, while cosmetics increased 12.6%, tobacco and alcohol rose 12.1%, and food products went up 7.9%. These gains were partially offset by continued weakness in big-ticket spending, with automobile sales plunging 16.1%. Sales of home appliances (-8.7%), building materials (-10.5%), furniture (-6.6%), petroleum products (-5.1%), and gold and silver jewelry (-3.4%) also declined. By segment, catering revenue increased 1.2%, while retail sales of goods rose 0.9%. Retail sales excluding automobiles increased 3.0%. On a monthly basis, retail sales rose 0.4%, following a 0.2% decline in the previous period. In the first half of the year, retail sales increased 1.3%, while consumer goods sales excluding automobiles rose 2.8%.

China’s retail sales fell 0.6% year-on-year in May 2026, the first decline since December 2022, following a 0.2% gain in April and defying expectations of a flat reading. The Labor Day holiday in early May failed to offset weak consumer spending, particularly for discretionary and big-ticket items, with automobile sales plunging 16.1%. Sales of home appliances and audiovisual equipment (-15.6%), building and decoration materials (-13.6%), gold and silver jewelry (-8.9%), furniture (-8.7%), and sports and entertainment products (-8.0%) also recorded notable declines. In contrast, sales of beverages (6.1%), tobacco and alcohol (4.8%), Chinese and Western medicines (4.0%), clothing (3.8%), and cosmetics (2.5%) increased. By segment, catering revenue rose 0.6%, while retail sales of goods fell 0.7%. Retail sales excluding automobiles increased 1.1%. On a monthly basis, retail sales fell 0.4%, following a 0.6% decline in April. For the January–May period, retail sales increased 1.4%.