People gathered to welcome the 'God of Wealth' during Lunar New Year celebrations at Qianmen Street in Beijing, China, on February 21, 2026. Image Source: Nurphoto via Getty Images
BEIJING — China's consumer market is showing signs of recovery strong enough to likely avoid the need for the large-scale stimulus that investors had been anticipating. During the recent nine-day Lunar New Year holiday, which concluded on Monday, there was a notable increase in spending nationwide, from hotel reservations to duty-free shopping. Rail travel set a new record with over 18.7 million passengers in a single day.
The promising data indicates that Beijing's recent economic support measures are having a positive effect. A report from CCB International Securities on Tuesday highlighted a significant trend: spending on experiences, such as travel and entertainment, is growing more quickly than spending on traditional goods, reflecting broader consumer preferences.
Despite a sluggish recovery in retail sales since the pandemic, China's consumer spending is picking up. Unlike the United States, which provided cash payouts to its citizens, China has implemented trade-in programs and vouchers to stimulate consumer spending. Chinese authorities have stressed the importance of boosting consumer incomes, though detailed plans have yet to be announced.
Awaiting Policy Adjustments
CCB analysts suggested that policymakers would likely introduce targeted, incremental easing measures following the positive holiday momentum. Such steps are expected to be announced around the March Two Sessions, the annual legislative assembly meeting, to stabilize expectations and maintain the recovery. Chinese Premier Li Qiang is anticipated to present the country's economic goals and policy priorities on March 5.
Despite the uptick in travel, consumers remain price-conscious. Nationwide, daily tourism trips grew by 5.7% compared to the previous year, remaining consistent with 2025 figures. Although spending rose by 5.5%, it decelerated from the 7% growth observed in 2025, noted Morgan Stanley Equity Analyst Lillian Lou. The holiday period saw a slight 0.2% year-over-year decrease in average spending per tourist trip, highlighting ongoing deflationary pressures.
To stimulate consumer spending, China extended the official holiday by an extra day compared to the previous year. This extension encouraged many to take additional personal leave, possibly causing official figures to underreport actual spending activities. 'The extended holiday encouraged families to travel together,' explained Jihong He, chief strategy officer at H World Group, indicating increased demand for larger, family-oriented accommodations.
H World, which operates over 12,000 hotels spanning over 30 brands in mainland China, reported that the top 10 destinations, each boasting hotel occupancy rates of 90% or higher, were located in economically vibrant southern or coastal cities like Sanya in Hainan Province. China further incentivized consumption by expanding a zero-tariff policy for Hainan, boosting duty-free luxury goods sales. During the holiday period, duty-free sales in Hainan surged 30.8% year-over-year, reaching 2.72 billion yuan (approximately $400 million).
Booking platform Fliggy, owned by Alibaba, noted that holiday season bookings for hotel and theme park packages more than doubled compared to the previous year. Scenic, yet remote destinations such as Altay in Xinjiang and Pu'er in Yunnan also saw booking figures more than double.