China's July Consumer Confidence Rebounds Amid Easing Inflationary Pressures

The Chinese spent more in July as inflationary pressures have eased with a fall in the food prices, according to the latest reading of an index that gauges the consumer confidence published Monday.

The Bankcard Consumer Confidence Index (BCCI), compiled by Xinhua News Agency, and China UnionPay, the national bankcard association, rose to 86.41 in July, up by 0.11 points from June, after falling for three months in a row.

Compared with the same period last year, the July BCCI figure was 0.49 points higher. The index hit a record high of 86.89 in March.

The rebound in the index was largely due to easing of inflationary expectations and a relatively robust economic performance, the report said.

China's consumer price index (CPI), a main gauge of inflation, rose to a 19-month high in May. It, however, dropped by 0.2 percentage points to 2.9 percent in June. Analysts said CPI would drop further in the second half of the current fiscal year amid the economic slowdown, which helped soothe consumers' worries over rising commodity prices.

The report said the government's curbs on soaring property prices and construction of affordable housing projects also contributed to the consumers' growing readiness to spend.

Xinhua News Agency and China UnionPay jointly started compiling the BCCI index in April 2009 based on bankcard transaction data and an analysis of the structural changes in urban consumption.