ANZ-Roy Morgan China consumer confidence declines slightly in June

ANZ-Roy Morgan China Consumer Confidence Index fell slightly to 143.7 in June, from a reading of 144.0 in the previous month. This is the second consecutive month of declines after the index rose to 145.0 in April from 138.0 in March month. Inflation expectations rose to 4.51% (last 3.67%) in June.

“Today's figures suggest that Chinese consumer sentiment basically holds up as domestic financial markets have stabilised. The slight decline in June does not change our impression that the economy continues to transform itself into a consumption-led economy," said Raymond Yeung & Louis Lam, ANZ Research.

China showed signs of a cyclical rebound in the early months of spring driven by turn in construction spending, pick-up in infrastructure projects and tentative improvement in exports. Housing activity was boosted by a significant decline in interest rates in 2015 and a reduction in the requirement for down payments for both first- and second-time buyers in September 2015 and again in February 2016. Recovery in this sector is set to continue in coming quarters.

"To some extent, the recovery of the real estate sector in the past twelve months has offered firm support to China's consumption level due to a positive wealth effect. Chinese policymakers will need to strive for balance in order to sustain the consumption growth in the future," Louis added.