China consumer: Retail sales momentum weakened further in May China’s total social retail reading recorded first y-y decline since COVID; no turnaround signal of the sector yet

Research evidence excerpt

China consumer: Retail sales momentum weakened further in May China’s total social retail reading recorded first y-y decline since COVID; no turnaround signal of the sector yet

Global Markets Research

16 June 2026China consumer

EQUITY: CONSUMER RELATED

Retail sales momentum weakened further in May Research Analysts

China Consumer Related

China’s total social retail reading recorded first y-y decline Jizhou Dong, CFA - NIHK

jizhou.dong@nomura.comsince COVID; no turnaround signal of the sector yet

+852 2252 1554

Total retail sales continued its weakening trend in May Summer Qian - NIHK

China’s total social retail sales recorded a 0.6% y-y decline in May to CNY4.1tn, the first summer.qian@nomura.com

y-y decline of this consumption measure since the end of 2022 when the Chinese +852 2252 6220

economy was just about to emerge from the COVID-19 lockdown, according to data from

the National Bureau of Statistics (16 Jun); the 0.6% y-y decline also missed the Wind

consensus of a mild 0.1% y-y increase. Total retail sales of merchandise by enterprises

above designated size was the major drag to the total social retail sales reading in May,

decreasing by 5.2% y-y. Although the deteriorated merchandise sales can be partially

attributed to high-base effect and unfavourable weather conditions (higher temperature

and more raining days in May 2026 that limited consumers’ activities), we believe the

disappointing consumption dataset in May also indicates a broadening softness of the

consumption sector. Given: 1) an absence of meaningful consumption-related policy

stimulation on the demand side; 2) limited wealth impact of property market recovery in

select tier 1&2 cities;, and 3) limited support to consumption by the AI-driven stock