New year data signals robust release of China's domestic demand

Editor's note: Liu Qiang is a research fellow at the Academy of Financial Research, School of Economics of Zhejiang University of China, and Yan Youliang is a research fellow at School of Accounting of Zhejiang Gongshang University of China. The article reflects the authors' opinions and not necessarily the views of CGTN. 

Consumption, the core engine for economic growth and a vital hub in the national economic cycle, plays an irreplaceable role in stabilizing market expectations and activating development momentum. It has increasingly become both the "primary driver" and the "ballast stone" of China's economic performance. As 2026 begins, the New Year holiday witnessed a vibrant surge in both supply and demand. 

As a key window for observing economic vitality, the holiday's consumption performance acted as a "trigger point" for releasing market potential, providing valuable forward-looking insights for the year's economic trajectory. Preliminary data show that the market burst with vitality, setting a positive tone for the country's economic operations in the year ahead.

Holiday travel ignites consumer enthusiasm

Increased mobility has significantly heated up the consumer market. The massive flow of people not only bolstered traditional services like transport and hospitality, but also catalyzed a multi-tiered consumption chain spanning culture and entertainment. Experts suggest this trend underscores growing consumer confidence and highlights the profound potential of the domestic market as a "stabilizer" of economic growth.

Diversified spending unlocks market potential

Diversified consumer choices are reshaping the sense of ceremony associated with the holiday. In quality dining, pre-sale "New Year's Eve" themed packages on the Meituan platform jumped 166 percent on the same period last year, while bookings for international cuisine restaurants surged by 98 percent. The "emotional and color economy" also took center stage. 

To usher in "good luck", red-themed products became highly sought after—sales of red lip glazes skyrocketed over tenfold, and red jewelry grew by 275 percent. 

This shift indicates that Chinese consumption is evolving from material satisfaction toward experience-based and emotional engagement. Amid a backdrop of supply-demand structural adjustments, this quality-oriented upgrade has become a key lever in implementing the national strategy to expand domestic demand.

Policy dividends activate market momentum

A series of targeted pro-consumption policies has yielded immediate results at the start of the year. The offshore duty-free market in Sanya recorded sales of 163 million yuan (approx. $22.6 million), up 83.2 percent on the year previous. To further stimulate the market, the National Development and Reform Commission and the Ministry of Finance allocated the first batch of 62.5 billion yuan (approx. $8.7 billion) from ultra-long-term special treasury bonds for 2026, specifically targeting consumer goods trade-in programs. 

Furthermore, financial innovation reached a milestone as digital yuan (e-CNY) balances began accruing interest, effectively lowering the psychological threshold for spending. This synergy of policies has facilitated the expansion and structural upgrading of the consumption market, supporting the public's pursuit of a better life.

The "flying start" of the 2026 New Year consumption market is more than just a reflection of market vitality; it is a concrete manifestation of the effectiveness of China's strategy to expand domestic demand. 

Guided by the "domestic demand-led" strategy from the Central Economic Work Conference, the role of consumption as a central hub is expected to strengthen further. Looking ahead, the fundamentals of China's economy—stability, resilience, and vast potential—remain unchanged. The continuous refinement of the domestic demand system will inject powerful momentum into high-quality development, opening a new chapter for steady and long-term economic growth.