Consumer confidence rebounds in Shanghai

Huang Yixuan
Pickup in confidence mainly attributed to efforts to fight COVID-19 and promotion of economic recovery, according to the Shanghai University of Finance and Economics.
Huang Yixuan

Shanghai's consumer confidence rebounded in the second quarter with the COVID–19 situation generally under control, according to a survey released on Tuesday.

The Shanghai University of Finance and Economics' quarterly Consumer Confidence in Shanghai Index increased by 2.9 points from the first quarter to 120.2 points for this year’s April-June period.

The university's Index of Investor Confidence, meanwhile, rose to 115.49 points, 1.47 points higher than that in the previous quarter.

For both indexes, a reading above 100 signifies optimism, below indicates pessimism.

The pickup in consumer confidence was mainly attributed to the city's efforts to fight COVID-19 and promotion of economic recovery, said Xu Guoxiang, director of the university’s Applied Statistics Research Center.

Businesses have resumed operations in general and people have also returned to normal life, which has bolstered consumer confidence as well as the economy, Xu said.

A sub-index of purchase intentions soared 12.3 points from the previous quarter to hit a record 106.1 points, 24.1 points higher than the same period last year.

The index of home-buying intentions advanced 8.2 points from the first quarter to 80.3 points, posting a year-on-year surge of 10.9 points.

The intention to buy cars, meanwhile, jumped to a record 110.9 points, compared with 100.5 points in the previous quarter and 29 points more than in the same period last year, while that for bulky durable goods rose by 18.4 points in January-March and was 32.5 points higher than a year earlier, indicating consumers are optimistic about the domestic economy.

The rise in the investor index indicated a more positive attitude, mainly due to achievements in prevention and control of the pandemic, as well as the support policies such as those on stabilizing investment and foreign trade and boosting consumption, said Xu and Chang Ning, a professor at the university's school of statistics and management.

"At the same time, the overall valuation of China's A-share market is now in a relatively reasonable range with strong resilience," they said.

"With liquidity easing and control of the pandemic, in the second quarter, corporate earnings recovered, yuan strengthened, and global capital will speed up investing in Chinese assets this year. These positive factors have lifted the confidence of investors as well.”

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