During China’s May Day holiday in 2025, domestic travel and consumer spending showed modest growth, with traveler expenditures increasing by 8% year-on-year to 180.27 billion yuan ($24.92 billion) and domestic trips rising 6.5% to 314 million. Transactions via the Weixin Pay app also grew by over 10%, especially in restaurant spending. However, per capita spending only rose slightly by 1.5% to 574.1 yuan, still below the 2019 level of 603.4 yuan. Cinema revenue dropped significantly, with ticket sales halving compared to 2024.

Despite a tourism boost, China’s services sector saw its slowest expansion in seven months in April, with the Caixin/S&P Global services PMI falling to 50.7. The ongoing U.S.-China trade war continues to weigh on business sentiment and employment in the sector, prompting firms to cut jobs and lower prices to stay competitive. While export orders improved slightly thanks to tourism, new business growth slowed markedly. Economists emphasize the need for government measures such as consumption vouchers and improved service quality to revive domestic demand and consumer confidence, which remain subdued amid deflationary risks and a sluggish economy.

Source: Reuters