In June, the slowdown in consumer spending in China continues, with one of the largest online shopping festivals in the country, the “618” period, experiencing a significant drop in year-on-year sales growth.
Data from retail analytics company Syntun released on Monday evening showed that during the annual “618” shopping event held from May 13 to June 18, total online sales saw a 4% year-on-year increase, a sharp decline from the 15.2% growth rate during the same period last year.
The “618” mid-year shopping festival originated from JD.com’s one-day online promotion on June 18, 1998, celebrating its establishment. It has since evolved into a month-long promotion spanning major e-commerce platforms in China.
According to CNBC, Goldman Sachs economist Hui Shan stated in a report on Monday, “The differentiation between high technology/artificial intelligence and real estate/consumption continues to widen, whether in industrial production or capital market data.”
“The domestic inspections of senior leaders of the Communist Party of China, recent policy communications, and our on-site channel investigations all indicate that these trends will continue,” he said.
In early March, the Communist Party of China released the “15th Five-Year Plan” (2026-2030), placing the digital industry after the economy and technology, elevating it as a special area to a high priority target, with a focus on artificial intelligence. Relevant discussions include the comprehensive implementation of the “AI+” action, seizing the high ground of AI industry applications, empowering thousands of industries in all aspects, and supporting the enhancement of AI capabilities for Southern countries.
However, the overall impact of AI on the macroeconomy remains uncertain. Shan mentioned, “The employment substitution effect triggered by AI may exacerbate the headwinds facing the macroeconomy, and slow down – or even obstruct – the recovery of the real estate market and household consumption.”
Chinese consumer data further indicates that while export and technology-related industries supported by the Chinese government are performing strongly, household consumption remains a weak link in the Chinese economy.
The total retail sales of consumer goods in May decreased by 0.6% year-on-year, the first decline since the lifting of epidemic control measures by the Communist Party in 2022.
Sheana Yue, a senior economist at Oxford Economics, wrote in a report on June 16, “The data for May further confirms the differentiation between strong external demand and weak domestic activity, with the contrast between export growth and subdued inflation, softening economic indicators becoming more pronounced.”
The “618” shopping festival also reflects the latest situation of Chinese consumer demand: despite major retailers launching promotions, consumer growth remains sluggish. Syntun estimated a total sales of 934 billion yuan (approximately 137.86 billion U.S. dollars) during the day, including “instant” delivery orders and group transactions.
Syntun’s report also shows that among major e-commerce platforms, Alibaba’s Tmall topped the sales figures, followed closely by JD.com and the Douyin under the ByteDance; however, the overall sales on this segment only grew by 0.9%. Second-hand electronics platform “ATRenew” stated that during the “618” shopping festival, the sales volume of second-hand products increased by nearly 80% year-on-year, highlighting the demand for low-cost goods by consumers.
Goldman Sachs has lowered China’s second-quarter GDP growth but maintained its full-year growth rate unchanged.