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JPMorgan says Chinese language customers are "moderately good" regardless of lack of retail gross sales

Chinese consumer purchasing power remains relatively robust, but uncertainty about the corona virus pandemic remains, said Tai Hui, chief Asia strategist at JPMorgan Asset Management.

China may have missed analysts' expectations for retail sales in June, but Chinese consumers "are still in pretty good shape," Hui told CNBC's "Squawk Box" on Friday.

"However, I think it is consumer sentiment that has been affected, for example, by the very brief outbreak in Beijing last month," he said.

It remains a "key question" whether Chinese citizens "feel more comfortable" to travel back home, Hui said, referring to increased gossip on topics such as summer vacation bookings for Chinese tourists domestically.

"We will see a little more signs of a recovery in the consumer sector in the third quarter, especially when some of the hardest hit sectors and services" go online, "said Hui.

His comments came from data released on Thursday that showed weak consumption in China. Retail sales were down 1.8% year over year in June, with economists surveyed by Reuters missing the expectation of a 0.3% increase. Retail sales in June followed the 2.8% year-on-year decline in May.

China's economy recovers in the second quarter

Hui commented on the likelihood of a change in the Chinese authorities' political stance from Thursday's economic data as follows: "I don't think the authorities will swing from one end to the other so drastically."

"If you listen to the National Bureau of Statistics, you're still very cautious about the prospects for the second half of the year, especially from an external demand perspective," he said.

China's private manufacturing investment remains "slow" due to corona virus uncertainty and weak external demand, Hui said.

However, he admitted that areas such as spending on public infrastructure "are increasing".

"I think the authorities are still very careful about the downside risk to the economy, but obviously they don't want a bubble or a debt-driven boom," he said.

Of a Economic management perspective: "You want to have sufficient liquidity for the economy, especially if … from the global … economic perspective, there are still many uncertainties in the second half of the year," said Hui.

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