Core Insights - The People's Bank of China conducted a survey in 50 cities, revealing a decline in income and employment sentiment among urban residents in the second quarter of 2025 [1][2] Income and Employment Sentiment - The income perception index stands at 45.0%, down by 1.2 percentage points from the previous quarter, with 10.2% of residents feeling their income has "increased" [1] - The employment perception index is at 28.5%, a decrease of 1.8 percentage points, with 6.4% believing "the situation is good, and employment is easy" [1] Price and Housing Expectations - The price expectation index for the next quarter is 56.4%, down by 0.7 percentage points, with 20.3% expecting prices to "rise" [1] - For housing prices, 8.9% of residents expect "an increase," while 21.7% anticipate a "decrease" [2] Consumer Behavior and Investment Preferences - 23.3% of residents prefer "more consumption," a decrease of 0.5 percentage points, while 63.8% lean towards "more savings," an increase of 1.5 percentage points [2] - The top five preferred investment methods are "bank non-principal guaranteed wealth management," "fund trust products," "stocks," "bonds," and "non-consumption insurance," with respective preferences of 34.8%, 24.7%, 16.3%, 15.3%, and 9.8% [2] Future Spending Plans - The top five items residents plan to increase spending on in the next three months are travel (32.1%), education (31.9%), healthcare (29.3%), social culture and entertainment (24.0%), and large goods (21.1%) [2]

Core Insights - The People's Bank of China released the second quarter 2025 banker and entrepreneur survey reports, indicating a neutral yet cautious outlook on the macroeconomic performance from over half of the respondents [1] Group 1: Banker Survey Insights - The macroeconomic heat index for bankers in Q2 is 33.2%, showing a decline from the previous quarter, with 61.9% of bankers perceiving the economy as normal and 35.8% as "cold" [3] - The bankers' expectations for the macroeconomic heat index in Q3 increased to 37.3%, up 4.1 percentage points from Q2 [3] - The monetary policy sentiment index for bankers rose to 74.6%, an increase of 6.6 percentage points from the previous quarter, with 50% considering the policy "loose" and 49.3% "moderate" [4] Group 2: Entrepreneur Survey Insights - The macroeconomic heat index for entrepreneurs in Q2 is 26%, with 50.8% viewing the economy as "normal" and 48.6% as "cold" [4] - The operating prosperity index and profit index for entrepreneurs increased to 49.3% and 53.2%, respectively, with 32.5% reporting improved earnings or reduced losses, up 6.5 percentage points from the previous quarter [4][5] Group 3: Consumer Sentiment Insights - The income sentiment index for residents in Q2 is 45%, a decrease of 1.2 percentage points, with 10.2% reporting income increases [6] - The employment sentiment index is at 28.5%, down 1.8 percentage points, with 6.4% perceiving the job market as favorable [6] - The consumer preference for increased spending is led by tourism (32.1%), education (31.9%), and healthcare (29.3%) [7] Group 4: Economic Outlook and Policy Recommendations - Analysts suggest that the government should balance short-term stabilization with long-term transformation, focusing on employment data and corporate capital expenditure as key indicators for economic recovery [8] - Recommendations include a combination of employment-first policies, targeted consumption vouchers, and urban renewal projects to stimulate demand and improve consumer confidence [8]

Group 1 - The consumer willingness index for Q2 2025 is reported at 120.2, indicating a slight decrease but still within a prosperous range, reflecting overall stability in consumer sentiment [1][3] - The decline in consumer satisfaction regarding the consumption environment is attributed to the prevalent "involution" competition among businesses, which primarily relies on price reductions and promotions [1][2] - The report emphasizes that while "involution" competition may temporarily satisfy consumer demand for lower prices, it risks deteriorating product and service quality, which consumers are unwilling to accept [1][2] Group 2 - The Q2 consumer willingness index of 120.2 is a 1.2-point decrease from the previous quarter but remains above the critical threshold of 100, indicating a stabilizing trend [3] - The expected consumption willingness index is at 128.8, showing a larger decline than the current index, suggesting that consumer confidence needs further strengthening [3] - The report highlights that stabilizing expectations, increasing income, optimizing supply, and ensuring livelihoods are essential strategies to activate the consumer market and support high-quality economic development [3]

Group 1 - The core consumer willingness index for Q2 2025 is 120.2, which is a decrease of 1.2 points from the previous quarter and a decline of 7.1 points compared to the same period last year [5][6] - The contribution rate of final consumption expenditure to economic growth in the first half of the year reached 52%, up from 49.9% in the first three quarters of last year [3][12] - The report indicates a significant drop in consumer expectation willingness, which is attributed to the complex domestic and international economic situation, leading to increased risk aversion and a higher savings willingness among consumers [5][6] Group 2 - The phenomenon of rising savings willingness among consumers is noteworthy, with savings being the primary use of disposable income, followed by education for children, travel, mortgage repayment, and medical expenses [6][7] - The "old-for-new" consumption policy has driven sales of 2.9 trillion yuan, benefiting approximately 400 million consumers, and has contributed to the growth of the retail sector [9][10] - Experts express concerns about the diminishing effectiveness of the "old-for-new" policy in the second half of the year, suggesting the need for further adjustments to consumption promotion policies [10][12] Group 3 - The restaurant industry has shown a decline in revenue growth, with June's year-on-year growth rate dropping to 0.9%, indicating potential challenges for the sector [13] - Recommendations for the restaurant industry include stabilizing growth, employment, and expectations to boost consumer confidence, as well as tax relief for small and medium-sized enterprises [13]

Core Insights - The report indicates that consumers are primarily allocating their surplus funds towards savings, children's education, travel, mortgage repayments, and healthcare, with savings being the top priority [1][4]. - Despite a slight recovery in consumer sentiment in Q1, overall consumption willingness remains weak, prompting discussions on where to focus efforts to stimulate consumption [1][4]. Consumer Spending Behavior - The survey, which included 5,000 consumers across various cities and rural areas, revealed that 48.8% of surplus funds are directed towards savings, followed by 45.5% for children's education, 33.1% for travel, 32.6% for mortgage repayments, and 29.3% for healthcare [4]. - A notable 10.4% of consumers reported having no surplus funds for additional spending [4]. - High-income consumers exhibit a stronger inclination towards saving compared to their lower-income counterparts [4]. Travel and Emotional Spending - There is a robust demand for travel, indicating a trend of consumption structure upgrading, as consumers seek to relieve stress amid uncertainties [4]. - Younger consumers are increasingly willing to spend on experiences that enhance their happiness and emotional well-being [4]. Factors Influencing Consumer Spending - Key factors that could lead to increased consumer spending include income growth (72.3%), stable employment (46.2%), lower prices (43.7%), improved social security (40.6%), and reduced mortgage pressure (32.7%) [5][6]. - Compared to the previous quarter, there has been a slight increase in the percentage of consumers citing favorable macroeconomic conditions and rising stock prices as motivators for spending [6]. Challenges to Consumer Spending - The report attributes the overall lack of consumer spending willingness to cautious expectations, which have led to a sustained high savings rate [7]. - Heavy burdens from children's education and mortgage repayments are also identified as constraints on other spending [7]. Recommendations for Stimulating Consumption - Experts suggest stabilizing consumer expectations through measures such as promoting stock market recovery, curbing the decline in the real estate market, and enhancing macroeconomic stimulus to boost domestic demand [8]. - Consumers have proposed various measures to enhance spending confidence, including improving social security, increasing macroeconomic policy support, and providing consumption vouchers [8]. Impact of External Factors - The report highlights the challenges faced by small and medium-sized enterprises (SMEs) due to external pressures, such as tariffs imposed by the U.S., which have led to reduced orders and financial difficulties [9]. - SMEs are encouraged to pivot towards domestic markets to mitigate risks associated with external market fluctuations [9].

Core Viewpoint - The article emphasizes the importance of boosting consumption to stabilize economic growth, highlighting the need for policies that enhance both consumption capacity and willingness [10][19]. Group 1: Factors Influencing Consumption - Consumption is influenced by two main factors: consumption capacity and consumption willingness. Consumption capacity is primarily affected by income, assets, and debt, while consumption willingness is influenced by economic expectations, social security systems, and available time for consumption [7][10]. - The current debt pressure on residents is significant, with the ratio of debt repayment to disposable income at 12.4% in Q3 2024, higher than in some developed economies [7]. Group 2: Policy Initiatives - The "Special Action Plan to Boost Consumption" outlines a comprehensive approach to enhance consumption through income increases, reduced burdens, high-quality supply, and improved consumption environments, with 30 key tasks across eight areas [10][19]. - The government plans to increase public consumption significantly, as a 1% increase in public consumption can lead to a 0.4% rise in private consumption over the long term [13][19]. Group 3: Targeted Support for Specific Groups - The plan focuses on increasing income for low- and middle-income groups, with measures including employment support and minimum wage adjustments [11][20]. - There is a specific emphasis on providing living allowances for recent graduates who have not yet found employment, recognizing their high marginal propensity to consume [21]. Group 4: Consumption Trends and Projections - In 2024, the growth rate of social retail sales is projected to be only 3.5%, with expectations to increase to over 5% due to enhanced fiscal spending [3][19]. - China's final consumption expenditure accounted for 55.6% of GDP in 2023, which is significantly lower than the global average, indicating substantial room for growth [6][19]. Group 5: Financial Support Mechanisms - The plan introduces fiscal subsidies for personal consumption loans, marking a shift in focus from corporate to individual support, which could stimulate consumer spending [16][22]. - The government aims to balance "old-for-new" policies with cash subsidies for specific groups to ensure equitable access to consumption incentives [19][20].

Core Viewpoint - The article emphasizes the significant potential for consumption growth in China, while also acknowledging the challenges in boosting consumer spending due to various factors affecting both consumption capacity and willingness [1][4]. Summary by Sections Consumption Capacity and Willingness - Consumption is influenced by two main factors: consumption capacity (income, assets, and debt) and consumption willingness (economic expectations, social security, and available time) [1][4]. - Increasing the income and welfare levels of low- and middle-income individuals is crucial for enhancing consumption capacity [1][4]. Policy Framework - The "Special Action Plan for Boosting Consumption" aims to enhance consumption capacity through income growth and reduced burdens, create effective demand through high-quality supply, and improve consumption willingness by optimizing the consumption environment [1][5]. - The plan includes eight areas with 30 key tasks, addressing various factors that suppress consumption [1][5]. Economic Stability and Consumption - The article outlines five key actions to solidify consumption's role in stabilizing the economy, including increasing public consumption investment, balancing "trade-in" policies with cash subsidies for specific groups, and supporting income growth for low-income individuals [1][4]. - The contribution of net exports to GDP growth is projected to be 1.5 percentage points in 2024, highlighting the need for domestic demand, particularly consumption, to rise [1][4]. Global Context and Consumption Potential - Globally, final consumption accounts for over 70% of GDP, with China's consumption share at 55.6%, indicating substantial room for improvement [2][3]. - The government prioritizes boosting consumption and improving investment efficiency as key tasks for 2025 [2][4]. Specific Measures for Consumption Boost - The plan includes measures to enhance income distribution, particularly for low- and middle-income groups, through employment support and wage growth initiatives [6][9]. - It also emphasizes the importance of public consumption, with a recommendation to increase fiscal spending on public services to support private consumption [9][14]. Focus on Major and Service Consumption - The article highlights the need for policies supporting both major consumption (e.g., automobiles, appliances) and service consumption, which currently lags behind developed economies [10][11]. - The plan includes specific actions to promote service consumption, such as improving service supply and attracting foreign investment [10][11]. Financial Support and Monitoring - The introduction of fiscal subsidies for personal consumption loans is a notable aspect of the plan, aimed at stimulating consumer spending [12][13]. - Monitoring the use of funds from consumption loans is essential to ensure they are used appropriately and to mitigate financial risks [17]. Long-term Economic Goals - The article stresses the importance of increasing the share of middle-income households in total income distribution to enhance consumption, projecting significant potential for consumption growth if successful [18][19]. - Achieving a GDP growth target of around 5% in 2024 will require a concerted effort to boost consumption, especially in light of declining export contributions [18][19].

□ 长期来看，消费还有很大提升空间，但也要客观看待提振消费的难度。影响消费的因素分为消 费能力和消费意愿两大类：影响消费能力的因素主要有收入、资产和债务；影响消费意愿的因素 包括对经济和未来收入的预期、社会保障体系完善程度，以及是否有消费时间等。其中消费能力 是能否提振消费的关键因素，故要想方设法增加中低收入者（边际消费倾向强）的收入和福利水 平 □ 《提振消费专项行动方案》总的政策思路是以增收减负提升消费能力，以高质量供给创造有效 需求，以优化消费环境增强消费意愿，并部署八方面30项重点任务。前七部分部署具体实施的七 大行动，第八部分进一步强调了完善投资、财政、信贷、统计等各项支持政策。文件覆盖面非常 广，涵盖了如何应对各类压制消费的因素 □ 考虑到消费对于经济平稳运行的重要性，接下来可做好五方面工作，以进一步夯实消费在稳经 济中的基石作用：一是更大力度增加财政对公共消费的投入；二是平衡好"以旧换新"和对特定群 体的现金补助；三是切实做好中低收入人群的收入合理增长工作；四是针对已毕业但尚未找到工 作的大中专毕业生，给予适当的生活补助；五是对个人消费贷款财政贴息的同时，加强资金用途 的监测 □ 当前，世界百年 ...