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ANZ-Roy Morgan China Consumer Confidence Increased Further on Easing Property Policy
October 22 2014
- Finding No.
Consumer Confidence Press Release
The ANZ-Roy Morgan China Consumer Confidence survey elicits respondents' expectations of inflation and prices. Data in October was collected from a sample of 1,000 Chinese aged 14+ (12,000 per annum) by telephone. The survey is conducted in metropolitan and outer urban areas - not only are 1st, 2nd and 3rd Tier cities included, but Tier 4 cities are also surveyed every month. The robust, representative sample is stratified geographically, with quotas controlled by gender and age.
ANZ’S Chief Economist for Greater China Li-Gang Liu said:
- ANZ-Roy Morgan China Consumer Confidence Index rose to 155.1 in October, 2.8pts higher than September. This is the highest level since February 2014.
- Sub-indices broadly improved in October. The sentiment for current financial situation rose 3.8pts, and the confidence of economic conditions next year increased by 1.0pt. Confidence for short term and longer term economic conditions went up by 4.3pts and 2.4pts respectively.
- By geography, consumer sentiments were mixed in October. Of the 14 cities surveyed, 9 cities saw improving sentiments, while only 5 cities recorded declining sentiments. Notably, consumer confidence in Beijing and Guangzhou rose 2.8pts and 4.8pts respectively, after falling somewhat in the previous month. However, that in Shanghai fell 1.2pt.
- Inflation expectation edged down further in October, marking the fourth consecutive month of decline.
“The October survey results suggest that consumer sentiments have been well supported by recent pro-growth policies, especially those for the property sector. With housing sales improving, the property market could gradually bottom out in the next two quarters.
"Just before National Day holidays, China’s central bank rolled out new mortgage policies. The most important policy change is that the central bank relaxed the criteria for ‘first-time home buyers’: for home owners who have paid up their mortgage loans on their first homes, the mortgage for second homes can be treated as first-time mortgages. In this case, more families could enjoy favourable policies, including relatively low down payment (minimum 30% of the home value) and discounted interest rates (as low as 70% of the benchmark lending rates).We estimate that about 30m Chinese urban families would benefit from this new mortgage policy.
"Recent property sales data also suggest that the housing market started to improve in the past month. Data compiled by China Index Academy show that the housing sales in 20 major cities increased for three consecutive weeks after the launch of the new mortgage policy.
Please refer to Page 4 for a further discussion on China’s passenger car sales.
"We believe that Chinese authorities will likely lower the transaction tax to further support the housing market, which will help improve the growth momentum somewhat in Q4 2014.”
Note: ANZ-Roy Morgan consumer sentiment survey compliments the surveys in Australia, New Zealand, Indonesia, China and etc. More consumer confidence surveys for other Asia-Pacific economies will be forthcoming.
Click to view the latest ANZ-Roy Morgan China Consumer Confidence Release PDF - October 2014.
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