Business

Why China’s emotional economy is on the rise

28-year-old Rebecca Zhou, born in China’s Sichuan province, owns an assortment of Moomin merchandise — bags, mugs, and figurines featuring the white hippo-looking cartoon character from Finland — that she has accumulated over the years.

By her own admission, many of these purchases may seem “childish”, but “it is [just] nice to treat yourself to something fun, even if it is not the most value-for-money,” Zhou said.

Zhou is not alone. Data from analysts and official sources show that Chinese consumers are increasingly spending on goods and experiences chosen for their emotional resonance over practical value — everything from theme parks to jewelry.

But what may once have been a fairly unsurprising consumer impulse is now being taken seriously by China’s business leaders and policymakers.

‘A sense of connection’

China’s “emotional economy” first entered into public discourse in 2024, after a craze over Pop Mart’s Labubu figurines appeared to signal shifts in Chinese consumer behavior, where a consumer group once characterized by norms of frugality and pragmatism appeared just as willing to splurge on self-indulgence.

“People are not just buying things,” said Ashley Dudarenok, founder of digital consultancy ChoZan told CNBC in a phone call. “They’re buying feelings, they’re buying identity, they’re buying a sense of connection.”

Over the recent Chinese New Year holiday, data from ChoZan shows that consumers spent significantly less on traditional staples like festive food gifts (known as nian huo), and more on unconventional expenses, like travel experiences and cosmetics compared to the same period in 2023.

“What people used to buy back in the day, like liquor and bulk nuts … were all about social obligations and tradition. Right now, people buy gift boxes, they buy designer toys … and people don’t frown upon that,” Dudarenok said.

This shift from obligatory to more discretionary spending over China’s largest holiday exemplified broader shifts in consumer norms, according to Dudarenok, with Chinese consumers increasingly looking to satisfy desires for personal fulfillment, over more “rational” purchases.

Beyond the Chinese New Year season, a February report from DaXue Consulting also highlighted tangible goods like aromatherapy candles and cosmetics, as growing segments in China’s emotional economy.

One estimate from the iiMedia Research Center projected China’s emotional economy to exceed a valuation of 4.5 trillion yuan ($655 billion) by 2029 — almost double its value in 2024 — as Chinese consumers seek ever-increasing “emotional relief and spiritual satisfaction”.

More stressed or just more comfortable?

But while many commentators have noted a growth in China’s emotion-driven spending, analysts are divided on what exactly is fueling this growth. The most common explanations see emotion-driven spending as a sort of stress response.

Traditional paths to happiness in China — buying a house and car, all while settling down and starting a family — have “grown increasingly expensive to follow,” Allison Malmsten, strategy consultant from DaXue Consulting, said by email.

In step with China’s ailing housing market — predicted to worsen in 2026, consumer inflation has also risen to a three-year high in February, according to China’s National Bureau of Statistics.

China’s rising costs of living have also dovetailed with record low birth rates in 2025, adding to a growing sense of loneliness among many in the country.

Compounded, these pressures have instilled in the average Chinese consumer “a sense of crisis,” Dudarenok said, pushing many to redirect spending toward things that “bring [them] joy.”

But for Bo Chen, senior research fellow from the National University of Singapore’s East Asian Institute, this sense of melancholy forms only part of the story.

For Chen, the structural legacy of China’s One-Child policy often concentrated familial resources from two parents (and four grandparents) on a generation of mostly single children.

This concentration of familial wealth — sometimes termed the “six pockets” effect — produced a younger cohort of Chinese consumers materially cushioned by their families in ways that previous generations were not, which gave them greater latitude to finance their material desires.

In a 2021 study, intergenerational income persistence — a measure of how the socioeconomic well-being of parents influenced those of their children — in China was found to have increased since 1979, particularly among China’s urban population.

Another study on homebuyers in Shanghai found that even those with considerable personal savings relied heavily on parental support to fund their purchases.

Such studies lend credence to Chen’s claims that, on average, younger Chinese consumers — one of the largest groups in China’s emotional economy — are increasingly buffered from the financial pressures of their forebears.

“This generation … they don’t need to worry about their lives that much,” Chen said in a call with CNBC.

Other macroeconomic trends, like the increased quality of China’s manufactured goods, has meant that nondiscretionary products and big-ticket items have longer replacement cycles for the average Chinese consumer, freeing up capital for other expenses.

With China’s thriving entertainment sector, Chinese consumers also have incentives to spend on entertainment like “Ne Zha 2”— the second installment of a Chinese movie franchise which broke records last year after coming in as the world’s highest-grossing animated film, Chen said.

Capitalizing on the emotional economy

What is unique about China’s emotional economy is how it is growing against a backdrop of slowing consumer spending.

In 2025, consumer spending in China grew by 2.3% from the year before, down from 5.2% in 2024, and 9.9% in 2023.

A People’s Bank of China survey further showed that for the fourth quarter of 2025, while interest in big-ticket purchases lagged pre-pandemic levels, the share of respondents willing to spend more on social and entertainment activities over the following three months reached an eight-year high over the same period.

In the U.S., where paid-for experiences are similarly accounting for a growing share of consumer spending, overall consumption has remained buoyant, posting quarterly growth between 0.5% and 0.9%. Unlike China, therefore, spending on emotional economy experiences in the U.S. is keeping pace with, rather than against, broader consumer spending.

This divergence has been noted by policymakers looking to spur consumer demand. Chongqing city government, for example, highlighted the role of the municipality’s emotional economy for the first time in its 2026 work report.

Businesses in China have also begun “reconsidering their value propositions,” according to DaXue’s Malmsten, with many looking into how they can lean into this trend of emotion-driven spending.

It taps into a feeling that consumers are demanding more of.

“For me, personally, buying these ‘childish’ items gives a comforting feeling of going back to childhood,” Zhou said. “It is a safe and nostalgic way of going back to adulthood.”

CNBC

Business

How is food reaching you despite regional tensions?

Keeping supermarket shelves stocked has become a logistics exercise playing out across ports, highways and international corridors, with operators reworking supply chains to ensure food and essential goods continue to reach the UAE without disruption.

At the centre of that effort is DP World, which has been prioritising critical cargo from the outset, working closely with government entities, traders and manufacturers to keep imports moving even as traditional shipping patterns face pressure.

In an exclusive interview with Gulf News, Ahmad Yousef Al Hassan, CEO and Managing Director of DP World GCC, said the approach has been structured around a clear hierarchy of needs, starting with food, pharma and agricultural inputs before moving to industrial supply chains that keep local production running.

“We work very closely with the government, especially a lot of the ministries, on the essential goods for the UAE. They fall into food and beverages, along with categories like milk, rice, animal feed and pharma,” he said.

Jebel Ali alone handled about 750,000 TEUs of essential goods last year, with roughly two-thirds tied to food and beverage shipments, providing a baseline for how much cargo needs to be protected during periods of disruption.

Mapping supply, not stockpiling

Instead of stockpiling, the focus has been on mapping demand and ensuring continuity of supply. Traders and manufacturers are being asked to identify their most critical imports, allowing DP World to prioritise cargo and route it through the fastest available channels.

“There’s enough essential goods, there’s no panic,” Al Hassan said, adding that the emphasis remains on keeping trade moving rather than building excess inventory.

That approach extends to sourcing as well. Where traditional suppliers face delays, alternative markets in India and Pakistan are being lined up, with feeder vessels used to move goods quickly into UAE ports. Other feeder operators have also been encouraged to follow the same prioritisation model to ease congestion and speed up turnaround times.

Cold chain gets added support

The fresh food supply has required additional intervention, particularly along longer inland routes. DP World has expanded refrigerated container capacity and introduced stopover solutions to maintain temperature control.

For instance, a dedicated inland facility has been introduced that allows refrigerated containers to plug in and stabilise before continuing their journey, reducing the risk of spoilage during extended transit.

“We have this reefer pit stop that will help out as well,” Al Hassan said, pointing to a broader push to reassure traders that temperature-sensitive cargo can be handled reliably.

Additional generator units have also been deployed to power refrigerated containers on trucks, giving logistics teams more flexibility across different corridors.

Global network steps in

The company’s international footprint is playing a central role in rerouting cargo flows. Ports in India and Pakistan are being used as staging points for transshipment, helping to keep eastern Gulf ports from becoming congested. For F&B alone, India and Pakistan together account for nearly 30% of the imports through Jebel Ali.

DP World is also using its integrated shipping and logistics solutions to design alternative routes and keep critical cargo moving efficiently across markets.

“This global network is what really pushes people to call us right away,” Al Hassan said, describing how customers are seeking real-time solutions to move construction materials, raw materials and food-related agricultural products.

Corridors expand across the region

Closer to home, multiple corridors are being activated to keep trade flowing. Routes through Fujairah and Khorfakkan are already operational, while discussions continue with Sohar Port in Oman to expand capacity and streamline processes.

Further north, DP World’s terminal in Jeddah is being used to absorb additional cargo, supported by ongoing talks between UAE and Saudi authorities to establish a bonded corridor that would allow smoother movement of goods between the two markets.

Each additional route adds flexibility for traders, reducing reliance on any single port or shipping lane.

Managing congestion to control costs

Even with supply holding steady, shipping and logistics costs have come under broader market pressure as diesel prices, insurance premiums, freight rates and other cost drivers evolve.

Al Hassan said that DP World’s focus is on keeping trade flowing efficiently and reducing congestion.

Faster clearance, better routing and coordinated planning help to ease pressures across the wider supply chain and limit the knock-on effect on end consumers.

Authorities are also closely monitoring prices, drawing on mechanisms developed during previous disruptions to maintain oversight across key categories.

Keeping the system balanced

The challenge is not only about moving food. Industrial supply chains must also remain active, from raw materials for manufacturing to equipment needed for ongoing projects.

Balancing these competing demands has required constant coordination among regulators, port operators, and private-sector players, ensuring that essential goods move first while maintaining sufficient capacity for broader trade.

The system has held so far, supported by a combination of planning, infrastructure and rapid decision-making.

That, according to Al Hassan, is what keeps shelves stocked without tipping into panic or shortage, even in a strained operating environment.

Business

Dubai gold dips on Hormuz jitters

Gold prices in Dubai edged lower on Monday morning, tracking a cautious global market mood shaped by rising geopolitical tensions and renewed inflation concerns.

At 9:19am, 24-karat gold was priced at Dh569 per gram, down from Dh572.25 on Sunday. The 22-karat variant fell to Dh526.75 from Dh529.75 a day earlier, reflecting a steady pullback after last week’s gains.

The latest move comes as investors reassess risk across markets following developments around the Strait of Hormuz, with global cues feeding directly into local bullion pricing. (Check latest UAE gold prices here, alongside prices in Saudi Arabia, Oman, Qatar, Bahrain, Kuwait, and India.)

April trend shows uneven recovery

Price action through April has been far from linear, with gold moving in tight ranges before slipping in recent sessions.

The month opened with 24K gold at Dh573 per gram on April 1, before easing into the Dh563 to Dh566 range over the next few days. A brief recovery saw prices climb to Dh577.25 by April 9, marking the highest level this month, before reversing direction again. Since then, prices have softened, with the current Dh569 level reflecting a gradual cooling from those peaks.

A similar pattern has played out in 22K gold, which moved from Dh530.75 at the start of the month to a high of Dh534.50, before easing back below Dh527 in recent sessions.

This pattern points to a market attempting to stabilise, but still reacting sharply to global triggers.

Geopolitics drives cautious tone

Global markets began the week in a defensive posture after the US signalled plans to blockade the Strait of Hormuz, a key artery for global energy supplies.

Michael Brown, Senior Research Strategist at Pepperstone, said markets are “trading in rather ‘textbook’ risk-off fashion, as participants reach once more for the ‘conflict escalation’ playbook.”

Energy markets have reacted immediately, with crude prices pushing back above $100 a barrel, adding to inflation pressures that are already building across major economies.

Inflation and rates cap upside

Recent US data showed inflation rising at its fastest monthly pace in nearly four years, driven largely by energy costs. That has reinforced expectations that central banks may hold rates higher for longer.

Higher borrowing costs tend to weigh on gold, which does not offer yield, making it less attractive relative to interest-bearing assets.

Brown noted that policymakers are likely to remain cautious, with limited evidence so far of broader inflation spillovers. “The potential for second-round effects remains limited,” he said, pointing to relatively stable core inflation.

At the same time, the dollar has strengthened, adding another layer of pressure on bullion prices globally and feeding into local rate movements in Dubai.

Liquidity and positioning in focus

Gold’s recent moves also reflect broader positioning across markets, where investors have been adjusting exposure amid cross-asset volatility.

Bullion had already seen a sharp correction since late February, falling close to 11% at one stage as investors sold holdings to cover losses elsewhere. While some recovery followed, the current environment suggests that liquidity conditions continue to play a key role in short-term price direction.

Business

Wall Street firm sends analyst to Hormuz, shares findings

As the world’s oil traders parsed satellite images and official statements for clues on the fate of the Strait of Hormuz, one research firm seems to have taken a different approach: It says it sent an analyst directly into the conflict zone.

Citrini Research, which issued a market-shaking bearish call on artificial intelligence earlier this year, said it dispatched an analyst to Oman’s Musandam Peninsula, where the person traveled by boat to observe shipping activity firsthand amid escalating tensions between Iran and the U.S. What the analyst claims to have found challenges the dominant narrative gripping global markets that the critical oil artery is effectively shut.

Instead, the analyst, whom the firm did not name due to the sensitivity of the activity, found that vessels are still moving through the strait, with traffic picking up in recent days to roughly 15 ships per day, according to the firm’s report posted on Substack. While far below normal levels, the flow suggests the disruption is partial and evolving rather than absolute.

“Tankers passing through four or five a day, completely dark on AIS. The volume, they said, is higher than what the data suggests, and it’s been accelerating in the past couple days through the Qeshm channel,” Citrini’s post said.

AIS is a ship-tracking system that broadcasts a vessel’s location, speed, identity and route. Citrini asserts that the actual shipping volume is higher than reported data as many ships turn off their transponders and are not visible on official tracking systems.

Citrini didn’t immediately respond to CNBC’s request for comment.

Based on the Substack post, the analyst’s interviews with fishermen, smugglers and regional officials point to a system in which Iran is selectively allowing ships to pass. Tankers are required to secure approval before transiting waters near Iranian territory, creating what the firm described as a “functional checkpoint” rather than a blockade, Citrini said in its post.

“This should drive home that what we’ve described as our view of the conflict is nuanced — it doesn’t fit neatly into ‘strait open crude down’ or ‘strait closed crude parabolic,’” the firm said.

To be sure, the findings are based on a single field trip and anecdotal accounts that are difficult to independently verify, particularly given limited transparency in the region.

The firm said it expects a more prolonged disruption that embeds a lasting risk premium into oil markets. That view underpins a preference for longer-dated crude exposure, with the firm favoring December 2026 WTI contracts over the front month.

“We think the disruption is longer and the new normal involves a permanent risk premium, but that we’ll likely see as high as 50% of pre-conflict traffic within the next 4-6 weeks,” Citrini said.

CNBC