May Day Holiday Consumption Surges On Back Of Re-opening

China’s May day holiday tourism spending jumped by 128.9% Y/Y, while domestic trips rose by 70.8% Y/Y, per BBG headlines. These jumps were well-telegraphed, both in terms of pre-holiday ticket sales and anecdotal evidence.

• For context, Chinese consumption is expected to hold firm in the immediate term, given the well-documented re-opening of the country, although questions over the medium-term sustainability of that dynamic remain evident.
• On the top-level policymaker front, last week’s Politburo communique noted that Q1 data came in better than expected, but concluded "demand remained insufficient" while "promoting high-quality growth remained challenging.”
• Looking ahead, there was a want to coordinate fiscal and monetary policies in a bid to boost demand, alongside the need to prevent risks related to housing, local government hidden debt and regional banks (well-documented areas of worry), in addition to a focus on improving social welfare and employment issues,