An aerial drone photo taken on May 3, 2025 shows tourists visiting the Fuzimiao scenic area in Nanjing, east China’s Jiangsu Province. People across China enjoy the ongoing May Day holiday in various ways. (Xinhua)
China’s retail sales in May rose by 6.4 percent year-on-year to 4.13 trillion yuan ($575.08 billion), according to data released by the National Bureau of Statistics (NBS) on Monday, which reportedly marked the fastest pace since December 2023 and exceeded major forecasts.
The growth of retail sales – a gauge of consumption – accelerated 1.3 percentage points compared with the previous month, per the official data. Previously, Bloomberg estimated the growth of retail sales at 4.9 percent, the same as the Wall Street Journal, while Reuters expected the figure to grow 5 percent.
NBS spokesperson Fu Linghui attributed the better-than-expectation consumption pick-up to strong spending over the May Day and Dragon Boat Festival holidays, the growth drive spurred by the “618” shopping festival sales promotion, and the effective boost from the consumer goods trade-in program.
Despite initial concerns over the China-US trade conflict in April and May, the actual economic performance defied pessimistic expectations. The principled agreement on the framework of measures reached by the two sides and the 90-day tariff-suspension period has created a more engaging space and bolstered market confidence, Cong Yi, a professor at the Tianjin School of Administration, told the Global Times on Monday.
As for the consumption pick-up in May, Cong specifically stressed the importance of the consumer goods trade-in program, which helped weather economic pressures during the April-May period as well as the broader second quarter.
Yang Delong, chief economist at Shenzhen-based First Seafront Fund, told the Global Times on Monday that consumption has become the most crucial driver of economic development, performing beyond investment and exports.
“In addition, macroeconomic policies intensified counter-cyclical adjustments, with coordinated fiscal and monetary measures driving growth in infrastructure and emerging industry investments in May,” Wang Peng, an associate research fellow at the Beijing Academy of Social Sciences, told the Global Times on Monday, adding that improved expectations for China-US trade relations have boosted business confidence and further stimulated market vitality.
In response to a question about whether the May economic figures reflected the outcomes of the Geneva trade talks with the US in aspects such as exports, employment, and trade, Fu said that the substantive progress achieved, and the important consensus reached in the Geneva talks had been beneficial for improving bilateral economic ties and boosting global growth.
Fu noted that China’s May economic performance remained stable, with steady production and demand expansion, improving employment, and sustained momentum in new growth drivers, reflecting sound policy support and high-quality development.
The NBS data on Monday also showed that the total value added of industrial enterprises above the designated size grew by 5.8 percent year-on-year, and national fixed-asset investment rose by 3.7 percent year-on-year.
China is advancing through a critical phase of industrial upgrading, driven by innovation and reinforced by robust new growth engines like high-end manufacturing, the digital economy, and new-energy industries, Fu said. For example, high-tech manufacturing output surged 8.6 percent year-on-year, with digital product manufacturing leaping 9.1 percent – both far exceeding overall industrial growth, according to the spokesperson.
Fu also highlighted the diversifying and growing trade in May as a representation of the nation’s strong economic resilience. Trade grew with ASEAN and Belt and Road Initiative partner countries, and exports of high-technology products expanded despite the sluggish global economy, declining trade with the US, and slower exports of some labor-intensive products.
These factors not only contributed to trade growth but also demonstrated China’s advantages of a super-sized economy, a complete industrial system, and strong comprehensive competitiveness, he said.
Commenting on questions regarding the country’s economic growth in the second quarter and even in the first half of the year, Fu noted that China’s economy got off to a good start in the first quarter. Despite increased external shocks in the second quarter, its solid foundations, effective policies, and strong growth drivers have underpinned its stable economic performance. China’s economy is expected to maintain overall stability with steady progress in the first half of the year, he said.
Fu also noted that the first meeting of the China-US economic and trade consultation mechanism reached principled agreement on implementing the important consensus reached by the two heads of state during their phone call on June 5 and the framework of measures to consolidate the outcomes of the economic and trade talks in Geneva, and made new progress in addressing each other’s economic and trade concerns. The meeting was conducive to promoting the stability and sustainable development of China-US economic and trade relations and will inject more stability and certainty into the global economy, he said.
Yang noted that the second quarter may see a slowdown due to tariffs. In the complex and volatile international environment of the second half, further boosting domestic demand will be crucial to ensure full-year GDP growth of about 5 percent.
Bolstering domestic demand is foundational. China’s vast scale, massive population, and middle-income demographic form the bedrock of its domestic demand, a critical buffer against external shocks. The impact of trade disruptions could be significantly mitigated by consolidating this foundation, Cong said.
In the face of complex circumstances, the key lies in unwavering commitment to our own priorities: implementing more proactive and impactful macro policies, continuously strengthening internal drivers of economic growth, and responding to external uncertainties with the certainty of quality growth, Fu said.
