Services including healthcare, entertainment and travel flourished while the share of housing in overall consumption fell, reflecting property-market troubles. Markedly lower consumer confidence and the secular slowdown in GDP growth cast a cloud on the consumption outlook.
- Consumer-facing businesses will need to be more targeted in their investments.
- Foreign firms can benefit from rising middle-class demand but will have to compete against increasingly competitive local firms.
- Weak market confidence could prompt consumers to put their extra funds into savings instead of property.
- Sellers of high-priced consumer durables could struggle in a market where consumers are less confident about the future.