Consumer holds keys to China's development: Westpac

SYDNE - The highly-anticipated release later this month of a new measurement of Chinese consumer sentiment reflects the game-changing influence of the Chinese consumer to global markets and the high-stakes race to crowd-source its hidden wisdom.

Australia's Westpac bank, through a knowledge partnership with the Deutsche Brse-backed MNI, will produce the Westpac MNI China Consumer Sentiment Indicator (CSI) to monitor households and the myriad observations they make in concert.

Huw McKay, Westpac's senior international economist said that consumers have been an important driver of China's development for many years, but their growing role across the globe is only now being grasped.

"In China the consumer is becoming the heart of the economy - so it's the collective psyche of Chinese consumer which is probably the key assumption that you need going forward to understand where the Chinese economy is going to go and how its development path is going to proceed.

"So we need to measure the Chinese consumer better, we need to know what is driving their confidence levels," McKay told Xinhua.

China's policymakers have always recognized that domestic demand serves as the basis of any lasting design for Chinese growth, but the capacity to track confidence remains one of the jewels in the crowning achievements of China's developmental success story.

"Confidence is exceptionally important," said McKay.

"It is the key unknowable but absolutely vital fact that you like to get a really good feel for when you are trying to predict where the economy is going to go - its confidence which affects how successful policy initiatives are with what kind of enthusiasm private sector will take up public incentives to invest, to employ, to purchase, so confidence really gives you the multiplier from the initial impulse."

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