Will China retail sales YoY growth exceed 8% for any month in Q3 2026?
The Condition
PBOC + State Council announce consumer-facing stimulus exceeding 2% of GDP by end of Q3 2026
Our Ensemble Estimates
Given demand pivot: Will China retail sales YoY growth exceed 8% for any month in Q3 2026?
Given no demand pivot: Will China retail sales YoY growth exceed 8% for any month in Q3 2026?
Causal Effect
Demand-side pivot worth ~24pp to retail sales exceeding 8% threshold, but still unlikely (30%) given property wealth destruction and structural barriers
Why This Matters
Tests whether a demand-side stimulus pivot directly activates consumer spending at a pace consistent with genuine demand recovery. China retail sales growth has been subdued amid property sector weakness, youth unemployment, and deflationary expectations. The stimulus-composition lens found that the largest demand-side measure (RMB 300B trade-in subsidies) is partially repackaged industrial policy with true demand creation at 40-50% of face value. A 2% of GDP consumer-facing package would be the largest direct test of whether fiscal spending can overcome the household confidence deficit.
Resolution Criteria
NBS China retail sales of consumer goods YoY growth exceeds 8.0% for any monthly release in Q3 2026 (July, August, or September data)
Source Analysis
CPI trajectory: two consecutive months above 0.5% YoY signals demand activation and consumer channel engagement