Feb 09, 2023
With the re-opening of the Chinese economy after the loosening of the Covid restrictions, significant pent-up demand by Chinese consumers can be expected. This should not come as a surprise as the Chinese consumer has restricted himself to the basics for almost three years, namely food and other staples. According to Pictet AM, household excess savings reach currently 5 trillion RMB, more than twice the 2014 levels and equivalent to 4% of Chinese GDP. Increased spending will probably not only flow into luxury goods but provide a broader growth boost especially for emerging markets with high demand for commodities and tourism.