China Retail Sales YoY: December 2025 Print Signals Deepening Consumer Slowdown
China’s retail sales for December 2025 rose just 0.90% year-on-year, according to the latest Sigmanomics database release. This marks a notable deceleration from November’s 1.30% and falls short of consensus estimates of 1.20%. The data, released January 19, 2026, underscores mounting headwinds for Chinese consumption as the world’s second-largest economy enters the new year.
Table of Contents
Drivers this month
December’s 0.90% YoY retail sales growth is the weakest since early 2023, extending a persistent downtrend from mid-2025. The reading is well below the 12-month average of 3.70% and sharply lower than the 5.90% pace seen in April 2025. Key contributors to the slowdown include:
- Softening demand for discretionary goods, especially electronics and autos
- Muted consumer sentiment amid property sector stress
- Lingering effects of high youth unemployment and wage stagnation
Policy pulse
With retail sales growth now running at less than one-third of its 2025 average, the print amplifies pressure on policymakers. The People’s Bank of China (PBoC) has maintained an accommodative stance, but the efficacy of monetary easing is increasingly questioned as consumer confidence remains fragile. Fiscal authorities may be compelled to accelerate targeted stimulus, particularly for households.
Market lens
Immediate reaction: The CNY weakened 0.30% against the USD in the first hour after the release, while the CSI 300 index slipped 0.70% as investors digested the disappointing data. Bond yields edged lower, reflecting expectations of further policy support.
Macro context
Retail sales are a bellwether for China’s domestic demand and broader economic health. December’s 0.90% YoY rise compares unfavorably with November’s 1.30% and October’s 2.90%. For further context, the indicator averaged 3.70% over the past year, with readings as high as 6.40% in June 2025 and as low as 1.30% in November 2025. The sequential slowdown is stark:
- April 2025: 5.90%
- June 2025: 6.40%
- August 2025: 3.70%
- October 2025: 3.00%
- December 2025: 0.90%
On a month-over-month basis, the deceleration from November’s 1.30% to December’s 0.90% is the steepest since late 2022. The data suggest that the post-pandemic consumption rebound has largely run its course, with households remaining cautious amid ongoing property market and labor market strains.
External shocks & geopolitical risks
Persistent trade tensions, global tech restrictions, and sporadic COVID-19 flare-ups have weighed on consumer confidence. The property sector’s ongoing correction and uncertainty around local government finances further dampen the outlook. Geopolitical risks—especially US-China tech decoupling—continue to cloud the medium-term consumption trajectory.
Financial markets & sentiment
Equity and currency markets have responded negatively to the weak print. The CSI 300 and Hang Seng indices both fell on the news, while the CNY’s slide reflects growing bets on further monetary easing. Consumer discretionary stocks underperformed, highlighting investor skepticism about a near-term consumption revival.
Drivers this month
- Discretionary spending (electronics, autos) contracted YoY
- Food and daily necessities remained resilient but could not offset broader weakness
- Online sales growth slowed, reflecting waning e-commerce momentum
Policy pulse
The PBoC is likely to maintain or even intensify its dovish bias. However, monetary transmission remains weak, with households opting to save rather than spend. Fiscal policy may pivot toward direct transfers or consumption vouchers to jumpstart demand.
Market lens
Immediate reaction: The USD/CNY pair rose 0.30% post-release, while yields on 2-year Chinese government bonds fell 4bps. The Hang Seng Index dropped 0.60%, led by consumer and retail names.
Scenario analysis
- Bullish (20%): Aggressive fiscal stimulus and stabilization in property markets trigger a rebound in retail sales to 3–4% YoY by Q2 2026.
- Base case (60%): Retail sales growth remains subdued, averaging 1–2% YoY in H1 2026 as consumer caution persists and policy support is only partially effective.
- Bearish (20%): Further property sector deterioration and external shocks push retail sales growth below 1% for several months, risking a negative spillover into employment and investment.
Risks & opportunities
Downside risks include renewed property market stress, global demand shocks, and policy missteps. Upside potential hinges on effective fiscal support, stabilization in the labor market, and a turnaround in consumer sentiment. The next few months will be critical for policymakers to restore confidence and arrest the downtrend.
Structural & long-run trends
China’s transition toward a consumption-driven growth model faces structural headwinds: aging demographics, high household debt, and a still-nascent social safety net. While digitalization and urbanization offer medium-term tailwinds, the near-term outlook remains clouded by cyclical and structural challenges.
Summary & implications
December 2025’s retail sales print is a wake-up call for China’s policymakers and investors alike. The sharp slowdown underscores the fragility of the consumption recovery and the limits of monetary easing in the absence of stronger fiscal support. Markets are likely to remain volatile as participants weigh the prospects for further stimulus and the risk of a deeper slowdown. The coming months will test the resilience of China’s consumer sector and the effectiveness of policy responses.
Key Markets Likely to React to Retail Sales YoY
China’s retail sales data is closely watched by global investors, as it signals the health of domestic demand and the broader economic cycle. The following tradable symbols are historically sensitive to swings in Chinese consumption:
- CSI300 – China’s blue-chip equity index, highly correlated with domestic consumption trends.
- 0700.HK – Tencent Holdings, a bellwether for Chinese consumer and digital spending.
- USDCNY – The USD/CNY currency pair, which often reacts to macroeconomic surprises and policy shifts.
- BTCUSDT – Bitcoin/USDT, which can benefit from capital outflows or risk aversion in China.
- ETHUSDT – Ethereum/USDT, another proxy for risk sentiment and capital mobility.
| Year | Retail Sales YoY (%) | CSI300 YoY (%) |
|---|---|---|
| 2020 | -3.90 | 27.20 |
| 2021 | 12.50 | 4.80 |
| 2022 | 3.20 | -21.60 |
| 2023 | 7.60 | -11.40 |
| 2024 | 5.20 | -8.90 |
| 2025 | 3.70 | -2.10 |
Historically, periods of strong retail sales growth have coincided with outperformance in the CSI300, while slowdowns have weighed on equity returns. The current deceleration suggests further downside risk for China’s equity benchmarks if consumer sentiment does not recover.
FAQ
Q: What does China’s December 2025 Retail Sales YoY data reveal?
A: The data shows retail sales grew just 0.90% YoY in December 2025, the weakest pace since early 2023, highlighting persistent consumer caution and downside risks to growth.
Q: Why is the December 2025 print significant for markets?
A: The sharp slowdown missed expectations and triggered declines in Chinese equities and the CNY, as investors anticipate further policy easing and question the strength of the recovery.
Q: How does the latest reading compare to the past year?
A: December’s 0.90% YoY growth is far below the 12-month average of 3.70% and marks a steep drop from the 6.40% peak in June 2025, signaling a clear downtrend.
Bottom line: China’s December 2025 retail sales print confirms a deepening slowdown in consumer spending, raising the stakes for policy action and market volatility in early 2026.
Updated 1/19/26
December’s 0.90% YoY retail sales growth is down from November’s 1.30% and well below the 12-month average of 3.70%. The chart below illustrates a clear and persistent downtrend since June 2025’s 6.40% peak, with each subsequent month marking a lower high. The last three months—October (3.00%), November (1.30%), and December (0.90%)—show a pronounced loss of momentum.
Compared to the same month a year ago, the current print is less than one-fifth of December 2024’s pace, underscoring the severity of the slowdown. The rolling six-month average has now fallen to 2.20%, its lowest since the pandemic era.