E-commerce giants and economists are expecting high sales data for the ongoing 2024 Double 11 online shopping spree in China, due to the implementation of a series of government subsidies to stimulate consumption.
"Double 11", which falls on Nov 11 every year, was launched by Chinese tech giant Alibaba in 2009. It has ballooned into an annual blockbuster period for retail, with days of discounts attracting customers to the country's online shopping platforms.
Data from e-commerce platforms such as Tmall, JD.com, and Douyin show that home appliances have been the top-selling category during the pre-sale period that started on Oct 14 this year, the earliest on record.
As the shopping spree reaches its climax on Monday, analysts and investors are watching for signs that consumption is rebounding in the world's second-largest economy after recent efforts by the government to boost activity.
Sluggish domestic consumption is among the top issues now facing policymakers in China, which has struggled to achieve a full post-pandemic recovery.
The Chinese government has in recent weeks announced a slew of the most aggressive measures in years aimed at bolstering growth, including key rate cuts and increasing the debt limit for local governments.
Analysts from the ING banking group said in a note last week that it expects to see "solid growth numbers" during the event, which it said "should comfortably outpace the overall consumption growth momentum".
The shopping spree this year is expected to generate over 1.2 trillion yuan (about 167 billion US dollars) in total sales volume, a growth of 15 percent compared to the previous year, said VO2 Asia Pacific, a consultancy specializing in the digital economy.
E-commerce giants expect high sales for Double 11 online shopping spree
E-commerce giants expect high sales for Double 11 online shopping spree
The fast expansion in China's total social financing, a broad measure of credit and liquidity in the economy, indicates that the country's financing activity is gathering steam and the government's pro-growth policies are gaining traction in bolstering the real economy, said two Chinese experts.
According to data released on Wednesday by the People's Bank of China (PBOC), the country's central bank, China's outstanding aggregate social financing totaled 424 trillion yuan (about 58.8 trillion U.S. dollars) at the end of April, increasing by 8.7 percent from the same period last year and quickening from the 8.4-percent rise in March. In the first four months, the newly added amount of financing to the real economy stood at 16.34 trillion yuan, up by 3.61 trillion yuan from the corresponding period of 2024.
Analysts said that accelerated government bond issuance aimed at boosting the economy drove the growth of total social financing.
"The issuance of government bonds has significantly accelerated this year. Among them, the issuance of ultra-long special treasury bonds and special treasury bonds for capital injection [into central financial institutions] launched in April, coupled with the continued rollout of special refinancing bond issuance for local governments, led to about 970 billion yuan in net financing, driving a growth rate of nearly 0.3 percentage points in total social financing," said Dong Ximiao, chief researcher at the Merchants Union Consumer Finance.
"This year's issuance of ultra-long special treasury bonds was launched one month earlier than last year, and together with credit loans, it has been the main driving force for the growth of social financing. Corporate bond financing has been growing steadily and equity financing has been steadily advancing, indicating an increasing role of the capital market in bolstering the real economy," said Lu Zhe, chief economist at the Soochow Securities.
According to this year's government work report, a total of 1.3 trillion yuan of ultra-long special treasury bonds will be issued, 300 billion yuan more than in 2024, while 500 billion yuan of special treasury bonds will be issued to support large state-owned commercial banks in replenishing capital.
Late last month, China issued this year's first batches of ultra-long special treasury bonds and special treasury bonds.
Part of the funds have been swiftly channeled into boosting consumer demand, a key focus in the country's efforts to spur economic growth.
"The Ministry of Finance has recently launched the issuance of 1.3 trillion yuan of ultra-long special treasury bonds to promote large-scale equipment upgrades and consumer goods trade-ins and to help implement major national strategies and enhance security capacity in key areas. We expect a fast rollout of special treasury bond issuance in the coming months to drive domestic demand, boost public confidence, and provide strong support for social financing," Dong said.
Fast growth in aggregate social financing indicates gov't efforts to spur economy paying off
