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. Last Updated: 07/27/2016

China Savings Drops




BEIJING -- China's avid savers have tucked away less of their money in the bank over the past two months, but there is little evidence they are spending enough to ease two years of stubborn deflation, analysts said Wednesday.


The government has tried nearly everything to persuade people to spend, including most recently a 20 percent tax on new bank savings.


But analysts said savers pulling money out of banks may have invested in stocks, bonds and insurance rather than buying consumer goods.


"We cannot equate a decline in bank savings to a rise in consumer spending," said Qu Hongbin, senior economist at the Bank of China International Research Ltd in Hong Kong.