But a set of official data the government was willing to share about July was bad enough.
Consumer prices in China fell last month for the first time in more than two years. Chinese banks extended $47.5 billion of new renminbi loans, tumbling 89 percent from June — and half the amount of a year earlier. Housing sales in terms of footage fell 6.5 percent in the first seven months of the year, after shrinking by nearly a quarter last year. In a country where three-fifths of the household assets are tied up in real estate, that decline is alarming.
The anxiety is running so high that people are using a social media site called Xiaohongshu to post talismans they think could help them sell houses.
China slipped into deflation after the government’s draconian “zero Covid” policy drastically suppressed consumption and business activity last year. Chenggang Xu, an economist at Stanford University, explained why deflation could be pernicious.
“The best scenario is that everyone expects prices will keep decreasing, so they will keep waiting for the prices to fall further,” he said. “The worst scenario is that people are very scared and very anxious.” Fear about their jobs or the survival of their businesses, he said, will cause them to save more and spend less, pushing the economy further into the trap of deflation.
With anxiety running high, people are already saving more and spending less.
Cob Liu, founder of an education start-up in a big city in southwestern China, said his revenue had remained flat this year, which is bad for a company that used to grow 40 percent a year. Mr. Liu, in his mid-30s, has about $1.5 million in cash but is determined to keep his monthly spending around $800, half of which goes to rent.
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