Despite the decline in performance, official data reported a 5.9% year-on-year growth in March, raising eyebrows among many Chinese netizens.
Retail sales, two wealthiest cities (2) of China’s two wealthiest cities, quickly abandoned in March, casting new doubts on the strength of China’s domestic consumer demand.
The weak performance contrasts with the narrative of China’s state-run media, emphasizing that strong consumer demand allows China to withstand rising US tariffs.
Beijing’s retail sales in March fell 9.9% from the same period last year, but Shanghai experienced an even more sharp decline, according to local government data released on April 18th and April 25th, respectively.
These numbers were disappointing for those who wanted March to bring strong rebounds to offset the decline seen in the first two months of 2025.
To revive domestic demand, Chinese authorities launched a nationwide trade-in program in March 2024, providing subsidies to upgrade items such as household appliances, automobiles and electronics.
Despite these efforts, Beijing saw a 38.2% decline in telecommunications equipment sales from the previous year, and car sales fell by 20.2% that month. This reflects both the limited impact of policy support and deeper consumer anxiety, as evidenced by consumer trust data, showing a year-on-year decline of 1.57% in January and 0.79% in February, according to financial data provider East Money Information.
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Category-specific data revealed that restaurant revenues fell 3.1% this March, highlighting the continued struggle of Beijing’s catering sector. Meanwhile, retail sales of capital goods fell 10.6% year-on-year, with the high ticket category becoming a major resistance.
One bright spot (a 28.5% surge in gold and gem sales) does not necessarily point to optimistic trends. Instead, consumers look to traditional safe assets amid growing uncertainty, indicating public uncertainty over China’s economic outlook.
Although Shanghai did not release category-specific retail data for March, first quarter data for 2025 showed car sales recorded the sharpest decline, falling 19.4% year-on-year.
Despite declining performance in Beijing and Shanghai, the National Statistics Bureau reported a 5.9% year-on-year growth in national retail sales in March. Many Chinese netizens questioned the accuracy of this number, given the contraction of two of China’s most developed cities. Some commenters laughed at the official data, habitually inflated the localities and denounced the bureau for drawing a false, optimistic picture of the economy.
Before China’s economic slowdown, growth was driven primarily by three key forces: “three horse-drawn carriages,” three key forces known as investment, exports and real estate. In recent years, the real estate sector has struggled with increased debt and severe liquidity issues, but policy changes and regulatory crackdowns have led to a sharp decline in foreign investment. Recently, new US tariffs on Chinese products have significantly weakened the country’s export sector.
Regarding official China retail data, US-based current affairs commentator Qin Peng once humorously spoke on his YouTube program.
