What: Chinese travels are recovering fast, but not as fast as expected by the government.

Why is that important: the country is accelerating toward normalization, but the government’s unmet optimism shows some febrility.

China's domestic travel during the eight-day Golden Week holiday surpassed previous pandemic levels and increased by 71.3% compared to last year, with 826 million domestic trips. Data from the Ministry of Culture and Tourism revealed these figures were up 4.1% from 2019. However, this growth was slower than the increases seen during other holidays earlier in the year, indicating a deceleration in the service sector's recovery, as noted by Goldman Sachs.

Despite the travel surge, the figures fell short of the government's forecast, which had anticipated 896 million trips generating CNY782.5 billion ($108.75 billion) in revenue. Actual revenue was recorded at CNY753.4 billion, a considerable rise from the previous year and a 1.5% increase from 2019.

In terms of international travel, inbound and outbound trips during the holiday recovered to 85% of the pre-pandemic figure, but this too was below government predictions. Retail sales by major companies grew by 9% compared to last year, while the nation's movie box office saw revenues of CNY2.7 billion, higher on a daily basis than 2022 but lower than 2019 and 2021. Meanwhile, China's property sector appears to be facing challenges, with new-home transactions in selected cities dropping approximately 20% compared to both last year and 2019 figures.

China travel continues recovery during golden week, but below Government expectations