New Shanghai COVID-19 Rules Dim China Luxury Market Outlook

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The Shanghai government’s announcement Tuesday of a policy that requires new arrivals in the city to stay away from public places for five days is likely to put even more pressure on the local luxury retail market.

, Zhengzhou and Harbin followed up with identical policies. Travel restrictions for new arrivals ranged from three to five days. Local governments also urged residents to cancel travel plans if possible. will affect the appetite for luxury goods. Barclays has previously stated that as long as severe lockdowns are not imposed in key cities, luxury sales in the Asia Pacific region will be up by around 5 percent in the second half of 2022.

“The development in the following few weeks may be key as we approach the Chinese New Year holiday, which falls early on Jan. 22, 2023, and which is one of the most important periods for Chinese cross-regional travel,” said the Barclays report. According to a Goldman Sachs report published on Nov. 6, China is likely to exit its “zero-COVID-19” policy in the second quarter of 2023, after the second Congress of the Party next March, when President

 

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