00:00Now it is the end of China's eight-day Golden Week holiday, which celebrates both China's National Day and Middleton Festival.
00:07Transport authorities report there were a record-breaking 2.4 billion trips made. That's an increase of over 6% from last year.
00:16The money made at box offices for films screened during Golden Week hit over $250 million.
00:23The domestic war film, The Volunteers' piece at last, took the most.
00:27Zhang Jui is the President and Chief Economist at Pinpoint Asset Management.
00:33It is very important. It's the second most important holiday in terms of the length of the holiday and, you know, how much people spend during the holiday and travel to other cities.
00:45And the good thing about the data points is that, number one, it's a high frequency, so we know what happens right after the holiday.
00:53And we have a lot of breakdowns in terms of, you know, hotels or restaurants, those kind of spending data.
01:00The other thing is that quality of the data is also very good, that this measurement of, you know, how many people travel to each place and how much money they spend.
01:10I think they are not estimated. These are actually collected very accurate data.
01:15And let's just drill down into that, because as you say, we're seeing travellers opting for cheaper hotels or zero-cost destinations like visiting parks and museums, cultural sites.
01:26What's driving this shift in consumption habits?
01:30You know, there's actually a trend that has been happening, I would say, you know, even during COVID and continued after COVID, that we've seen this trend of what we call consumption downgrade for some of the households in China.
01:49I think part of that is driven by, you know, the slowdown in the property sector, that property prices coming down, that has a negative wealth effect on many of the households, because, you know, properties, you know, that's probably the most important part of household wealth.
02:07So that purge the consumer sentiment, and that's probably the key reason why they're holding back.
02:14But why hasn't the stronger stock market translated into higher household spending?
02:24I think it is already helping on some of the items.
02:28I was told that some of the luxury goods, actually, sales numbers recently improved compared to first half of the year.
02:36But, you know, luxury goods only account for a small part of the overall consumption.
02:42And the overall consumption is driven by, you know, the overall household wealth, which is predominantly housing property rather than stocks.
02:52So it's helping part of the consumption basket, but not the whole basket.
02:58Your next answer is going to be seized upon by finance ministers around the world.
03:03How do you fix and improve consumer confidence?
03:07I mean, what needs to be done to encourage spending?
03:12Yeah, I think it takes time.
03:13You know, part of the solution could come from government policies to continue to support consumption, particularly helping the labor market.
03:23Hopefully, down the road, that the unemployment rate will come down so that people's outlook for their future income stabilize.
03:31That would help to boost consumption, make the households more confident.
03:36The other part I think is equally important is the stabilization of the property price.
03:41The property price has been falling for four years by now, and I think sometime down the road it will stabilize and then it will translate into, you know, better sentiment-related household wealth effect and then better outlook for future wealth.
04:01And then, you know, consumption pattern hopefully will stabilize together with it.
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