Chinese people give up investing in securities and switch to hoarding property and real estate
According to CNBC, the rate of people reducing spending and giving up on investments is increasing to a multi-year record in China as the Covid-19 epidemic continues to develop complicatedly.
A survey by the People’s Bank of China (PBOC) recently released showed that only 21.6% of respondents wanted to invest in the current context, a record low since the first quarter of 2009.
In particular, this country’s stock investment channel is ranked as the least attractive among the investment channels that people target. Only about 16.2% of respondents said they bought securities in the first quarter of 2022, down from 17.2% in the fourth quarter of 2021.
On the contrary, the real estate channel retains its attraction despite a series of companies defaulting on loans in the industry recently and the state’s move to tighten credit management. The PBOC survey showed that 17.9% of respondents said they bought a home in the first quarter of 2022, the same level as the previous quarter.
Not only investment, Chinese people now also limit spending and switch to hoarding assets. About 54.7% of respondents said they have been hoarding assets rather than spending-investing as before, reaching a record high since the third quarter of 2002.
This is not very positive information when the story of the Omicron mutation that caused many economic centers such as Shenzhen and Shanghai to be quarantined throughout the city is worrying people.
According to UBP economist Carlos Casanova, China will probably abandon the “Zero Covid” policy when the pandemic has entered its third year and shows no sign of ending. Specifically, it is likely that the Beijing government will have a strategic change in the second half of 2022 in the context of the economy facing risks of deceleration, supply chain disruption because of the pandemic.
*Source: CNBC
By Business and Marketing
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