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China says consumption growth likely to slow further this year

Reuters  |  BEIJING 

(Reuters) - Consumption growth in is "very likely" to slow further this year as the economy cools, the commerce ministry said on Tuesday, underlining the rising risks facing the Asian giant as it navigates a trade war with the

Chinese authorities have already rolled out a flurry of support measures to temper the effects of the trade dispute on businesses and investment, and are counting on the nation's vast base to cushion a broader economic slowdown.

"The medium- to long-term accumulated contradictions and risks throughout economic development are going to become more prominent in 2019," Wang Bin, a told reporters during a briefing.

"The pressure facing the market will increase and consumption growth is very likely to slow further."

Wang said softness in sales last year, which saw growth averaging 9 percent for the slowest in 15 years, was due to "periodic" weakness in and housing-related spending, though other categories continue to post "relatively normal" growth.

Sales in the world's biggest auto market shrank for the first time since the 1990s.

Japan's last week cut its annual profit outlook after disappointing quarterly earnings it blamed on slowing Chinese demand for auto components and

sales growth during the just concluded Lunar New Year holidays slipped to its lowest since at least 2011, further evidence consumers remain cautious as the economy hits the brakes.

However, Wang cautioned against becoming overly gloomy on the sector, saying government policy support measures should cushion the downside.

Indeed, the market appeared to have been unscarred by the general slowdown in the

Strong Chinese demand helped L'Oreal, beat sales forecasts in the fourth quarter while the French luxury handbag label Hermes said sales momentum in its Chinese stores stayed strong last quarter.

China's rich consumers' appetite for will remain robust this year, with strong growth in purchasing power among the younger generations, Daily said on Tuesday, citing an industry survey from and Search Group.

The official gauge of only covers spending on physical goods and excludes services.

said it was heading into 2019 with record bookings for cruises and seeing higher demand from Chinese tourists.

(Reporting by Yawen Chen, and Ryan Woo; Editing by & Shri Navaratnam)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Tue, February 12 2019. 11:04 IST