China's Consumer Market Shows Broad Recovery, Q2 Growth Expected to Continue Moderate Uptick

Deep News04-07

During the three-day Qingming Festival holiday, domestic tourism trips nationwide reached 135 million, a year-on-year increase of 6.8%, with total tourism spending amounting to 61.367 billion yuan, up 6.6% from the same period last year. This year's Qingming holiday saw another wave of "spring fever" in the national consumer market. Data released on April 7 by the Ministry of Culture and Tourism showed that the holiday period generated 135 million domestic tourist trips, a 6.8% rise compared to the previous year, and total tourism expenditure reached 61.367 billion yuan, growing by 6.6%.

The robust holiday economy was supported by the alignment of spring breaks for primary and secondary schools with the Qingming Festival holiday in many regions across the country. This convergence spurred a travel boom dominated by parent-child and family trips, which quickly extended to transportation, accommodation, dining, retail, and leisure entertainment, effectively unleashing spring consumption potential.

Zhu Keli, founding dean of the Guoyan New Economy Research Institute, noted that this year's spring consumer market is characterized by broad-based recovery, integration of consumption scenarios, and strong performance on both supply and demand sides. The vibrant holiday spending reflects a longer consumption chain and an optimized consumption structure, indicating a more solid and sustainable contribution from holiday economy to overall consumption.

Ctrip Research further pointed out that the pilot spring break effectively created an additional "mini golden week," not only contributing significantly to domestic tourism spending but also expected to drive over 250 billion yuan in added value for related industries. This initiative directly promotes employment and continuously injects new momentum into domestic demand expansion.

A promising start for the "spring economy" was evident. According to business big data from the Ministry of Commerce, during the Qingming holiday, average daily sales of key retail and catering enterprises nationwide increased by 2.4% year-on-year. Foot traffic and revenue at 78 monitored pedestrian streets and commercial districts rose by 6.0% and 6.7%, respectively.

In terms of goods consumption, as of April 5, the automobile trade-in program had received 1.526 million subsidy applications, generating new car sales worth 246.8 billion yuan. Sales of appliances replaced through trade-in programs, along with digital and smart products, reached 62.845 million units, contributing 215.97 billion yuan in sales. Smart glasses, smart watches/bands, and smart blood glucose monitors saw sales surge by 320%, 12.3%, and 19.6%, respectively, during the holiday.

Service consumption also showed strong growth. Catering sales at key monitored enterprises increased by 3.9% year-on-year. Hotel accommodation spending on major platforms rose by 2.6%, while cross-city travel trips grew by 15.1%. Theme park spending increased by 11.7%, parent-child study tour orders doubled, and car rental orders surged by approximately 40%.

Additionally, visa-free policies combined with the holiday window boosted inbound tourism, with orders from international visitors nearly doubling year-on-year. Ctrip reported that among the top 20 source countries for inbound travel, 15 were visa-exempt, with order growth from these countries significantly outpacing non-visa-exempt countries. Ticket and entertainment purchases by visa-exempt travelers grew at a rate seven times higher than those from non-visa-exempt countries. The multiplier effect and growth potential of visa-free policies are expected to continue.

Zhu Keli emphasized that the strong holiday consumption, supported by favorable policies, sets a positive tone for the steady recovery of the annual consumer market. This reaffirms the resilience, potential, and vitality of China's consumer market, providing solid support for sustained economic improvement.

The combination of spring break and Qingming holiday effectively unleashed family and parent-child travel demand. With spring breaks in provinces such as Jiangsu, Zhejiang, Anhui, and Guizhou creating up to six consecutive days off, family travel saw a notable increase. Qunar's report indicated that the Qingming holiday, linked with spring break, was busier than usual, with overlapping demand for parent-child trips, nearby travel, and long-distance journeys.

Travelers covering distances over 800 kilometers increased by more than 30%, with many opting for off-peak long-distance spring trips. Popular flight routes saw ticket volumes rise by over 40% year-on-year. The proportion of young travelers also surged, with passengers aged 13–18 increasing by 70%, and visitors in this age group to scenic spots growing by 3.8 times.

Spring consumption during the Qingming holiday extended from outings and flower viewing to dining, retail, and leisure entertainment. Tongcheng Travel data showed that from April 4 to 6, strong travel demand boosted the nearby travel market. Bookings for high-quality hotels in surrounding areas increased by 60% month-on-month, while homestays offering spring-themed activities saw a 90% rise in reservations.

Experiences such as nature-focused camping and immersive Hanfu photoshoots gained popularity, with related product bookings up 230% month-on-month. Douyin data revealed that group buying sales of spring tea surged by nearly 24 times year-on-year. Sales of spring vegetables like bamboo shoots and Chinese toon increased by 209%, while orders for crayfish, entering peak season, grew by 132%.

Demand for spring renewal continued to explode, with group buying sales of apparel, footwear, cosmetics, and personal care products rising by 110% and 155%, respectively. Supermarket shopping vouchers and jewelry sales also saw significant increases, up 106% and 183%, respectively.

Tongcheng Research Institute believes that this year's Qingming holiday demonstrated the significant potential of combining off-peak holidays with traditional festivals to stimulate consumption. As tourists shift from sightseeing to gaining knowledge and families turn trips into "mobile classrooms," the cultural and tourism industry is upgrading from resource supply to content creation. This further unleashes the holiday economy's role in driving local consumption and industrial transformation, providing a vivid case for sustainable tourism development.

Wang Peng, associate researcher at the Beijing Academy of Social Sciences, analyzed that extended holiday periods are shifting short-distance family visits to long-distance in-depth travel, broadening cross-regional travel ranges and activating consumption potential in industries like aviation and accommodation. Off-peak holidays help alleviate traditional holiday congestion, balance resource allocation, narrow the gap between peak and off-peak seasons for scenic spots and hotels, and improve overall service quality and operational stability.

This creates a new growth pole for consumption between the Spring Festival and Labor Day holidays, converting seasonal advantages into actual consumption momentum. It also facilitates the transition of the holiday economy from concentrated bursts to sustained growth, laying a foundation for annual consumption expansion.

Consumer growth in the second quarter is expected to continue its moderate recovery. To capitalize on holiday consumption peaks, policies to boost spending have been intensively rolled out from central to local levels recently. A day before the holiday, nine departments including the Ministry of Commerce jointly issued the "2026 Action Plan for Improving Service Consumption Quality and Benefiting the People," aimed at expanding high-quality service supply, unleashing service consumption potential, and better meeting personalized, diverse, and quality service consumption demands.

The plan outlines 64 specific measures across six areas: improving policy support, innovating consumption scenarios, building platform carriers, expanding openness, strengthening standards, and optimizing the consumption environment. It focuses on traditional service consumption sectors such as catering, accommodation, elderly and child care, culture, entertainment, tourism, sports, and health, as well as new growth areas like home services, online audiovisual content, inbound consumption, and performance services, targeting both supply and demand to create new consumption scenarios with broad impact and high visibility.

For inbound tourism, in March, nine departments including the Ministry of Commerce released policies to promote travel service exports and expand inbound consumption. The measures cover 16 specific actions across seven aspects: boosting inbound tourism spending, facilitating business activities, activating inbound event consumption, enriching cultural and entertainment consumption, expanding health-related consumption, developing education and training consumption, and improving support measures, aiming to build globally attractive inbound consumption destinations.

An official from the Ministry of Commerce's Service Trade Department explained that a key feature of these policies is their "comprehensive coverage of inbound scenarios." The document not only focuses on traditional tourism shopping but also includes business exhibitions, event attendance, health consumption, and education training, addressing various inbound purposes and consumption needs.

Despite impressive inbound tourism data in recent years, challenges such as payment, booking, and language barriers for foreign visitors remain. Another distinctive aspect of the policy design is the establishment of a full-chain promotion system. The Ministry of Commerce indicated efforts will focus on two directions: enhancing China's appeal through national tourism branding, targeted global marketing, and improved visa policies to attract more international visitors; and addressing bottlenecks in the entire inbound process—from dining and accommodation to transportation, sightseeing, shopping, and entertainment—by implementing convenience measures in payment, tax refunds, communication, tours, and ticketing.

Yang Mu, director of the Market Operation and Consumption Promotion Department at the Ministry of Commerce, stated at a recent press conference that efforts will deepen special actions to boost consumption and adopt multiple measures to sustain consumption growth. Key tasks include expanding and upgrading goods consumption, unleashing service consumption potential, energizing offline consumption, and stimulating demand in lower-tier markets.

Zhu Keli emphasized that the next phase of consumption promotion should focus on long-term mechanisms to continuously release domestic demand potential. This involves deepening cultural and tourism integration, enriching high-quality consumption supply, creating more immersive, experiential, and leisure-oriented new formats, addressing service support shortcomings, optimizing the consumption environment, and ensuring consumption safety.

It also requires leveraging key consumption nodes, rolling out targeted benefit measures, encouraging joint discounts from scenic spots, restaurants, and hotels, and activating rural and nighttime consumption potential while removing consumption bottlenecks. Upgrading the cultural and tourism industry to lead consumption demand with quality supply will help convert short-term holiday consumption heat into long-term growth momentum, supporting steady recovery in the consumer market.

Driven by the holiday economy, the consumer market in the second quarter is expected to maintain a moderate recovery trend. Wu Chaoming, chief economist at Chasing Financial Holding, projected that despite weak momentum in retail sales growth due to high base effects and subdued consumption capacity and willingness among middle- and low-income groups, factors such as improving employment and income from rising prices, reduced drag from the property sector, and wealth effects from capital market recovery will support household balance sheets. Coupled with pro-consumption policies, retail sales growth in 2026 is expected to see a moderate rebound, with annual growth around 4.5%, and service consumption likely achieving higher growth rates.

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

We need your insight to fill this gap
Leave a comment