The Lunar New Year holiday wasn’t quite back to normal this year as fears of spreading COVID to elderly relatives prevented many households from returning to their hometowns – long-distance journeys, while the highest since the start of the pandemic, were still 45% below 2019 levels. That didn’t stop consumers from engaging in a bit of “revenge spending” closer to home, however. According to the State Tax Administration, receipts at consumer-facing businesses were 12% above 2019 levels. That’s in line with separate data showing strong gains in cinema and restaurant sales. Spending at domestic tourist sites is recovering more slowly but still reached 73% of 2019 levels, the most since mid-2021, a time when the economy was booming and virus disruptions were minimal. All of this is consistent with our expectation for a rapid rebound in consumption during the first half of this year.
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