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Goldman Sees China Household Spending Rising 4.5% in Second Half

  • Annual consumption expected to climb 1%, analysts say
  • Wage growth may remain sluggish as labor market still weak
Shoppers at a store in Shanghai.

Shoppers at a store in Shanghai.

Photographer: Qilai Shen/Bloomberg

China’s household spending may rebound in the second half of 2022, increasing 4.5% from a year earlier as Covid restrictions ease and the economy begins to recover, according to Goldman Sachs Group Inc. economists.

That expansion would follow a gloomy second quarter, with Goldman forecasting spending in the April-to-June period likely contracted 1.5%, largely because of slower growth in family cash flows, a battered services sector and dampened sentiment, as reflected by a rising desire for precautionary saving.