Consumer sentiment across the Asia–Pacific (APAC) region is as varied as the economies themselves. Our latest research reveals a mix of optimism and caution, with spending behaviors reflecting both resilience and adaptation to economic pressures. India leads the region in discretionary spending, with consumers splurging across categories such as dining, travel, and electronics. In contrast, South Korean consumers are pulling back, particularly in travel, as they navigate economic headwinds. Meanwhile, Japanese consumers are adjusting to inflation levels not seen since the 1990s and sentiment remains subdued.
The following charts highlight key insights from our latest APAC consumer survey, showcasing how diverse economic conditions and consumer priorities are shaping spending habits across the region. We cover Australia, China, Japan, South Korea, and India.
Australia: Optimism rises, pessimism drops
Among the five APAC countries surveyed, Australia experienced the greatest shift in consumer sentiment this quarter, with net sentiment (optimism minus pessimism) rising by three percentage points compared to the previous quarter. In contrast, consumer sentiment across most APAC countries has remained relatively unchanged, even amid ongoing geopolitical tensions.
In Australia, 20 percent of consumers reported actively seeking information about tariffs, and 21 percent indicated that they had adjusted their shopping behaviors in response to the tariff announcements—among the lowest levels of engagement across the surveyed countries. The positive sentiment shift in Australia likely reflects growing optimism about an anticipated economic rebound following a period of sluggish growth.
China: Optimistic yet uncertain
Despite ongoing uncertainty surrounding trade policies, Chinese consumers are increasingly optimistic about their economic prospects. In our work in the region, we’ve observed that many Chinese consumers view China’s trade position as favorable, and that consumption growth remains robust. This optimism is likely fueled by improving economic conditions and a drop in inflation in recent months.
The survey results mirror these observations. The number of consumers citing rising prices as a top concern has dropped ten percentage points compared to the previous quarter. However, uncertainty persists. Approximately 23 percent of Chinese consumers report being extremely concerned about tariffs, highlighting lingering apprehensions. How this concern will influence spending behavior remains unclear, especially as the intent to splurge continues to rise from already elevated levels.
Japan: Pessimistic but evolving
Japanese consumers have been slower to adopt new shopping behaviors compared to other APAC countries, but they experienced the most significant quarter-over-quarter change, with a 7 percent increase in consumers engaging in new shopping habits. This marks a notable shift in a market traditionally characterized by stability in consumer behavior.
The most prominent trend has been an increase in shopping frequency, which has been steadily rising over the past year, up six percentage points overall since Q2 2024. Additionally, more Japanese consumers are delaying purchases, with this behavior jumping from 13 percent to 19 percent in the last quarter. Overall, the proportion of consumers engaging in any new shopping behavior has surged from 36 percent to 51 percent over the past year.
These changes align with the challenges Japanese consumers are facing as they contend with inflation levels not seen since the 1990s. Consumer sentiment remains deeply pessimistic, with only 7 percent of respondents expressing optimism—a sharp 30-point decline over the past year. Furthermore, 67 percent of Japanese consumers cite rising prices and inflation as their top concern, the highest among all APAC countries surveyed. In a related trend, discount stores have gained popularity in Japan as consumers seek deals for daily necessities. The number of these stores tripled in the 15 years between the 2008 market crash and 2022.
South Korea: Cautious amid challenges
South Korean consumers are pulling back on travel spending, reflecting a broader trend of cautious consumption. Across various travel categories—including flights, accommodation, and short-term rentals—spending intent has declined notably compared to the previous quarter. This marks a shift from last year, when travel spending was on the rise. The decline comes even as consumer pessimism has eased slightly in recent months, suggesting that other factors, such as economic uncertainty, may be influencing spending behavior.
While inflation in South Korea remains stable at 2.1 percent, the economy is facing headwinds that are contributing to a more cautious outlook. GDP has seen slight declines both year-over-year and quarter-over-quarter, and the Bank of Korea is expected to lower its 2025 growth forecast in response to these challenges. These economic pressures may be prompting many consumers to reassess their spending priorities, focus more on essentials, and scale back on discretionary purchases.
Tariffs are also weighing on South Korean consumers. In this survey, 26 percent of respondents identified tariffs as one of their top concerns. Notably, 43 percent of consumers have actively sought out information about tariffs—one of the highest percentages globally. While relatively few (6 percent) have already changed their spending habits in response, 40 percent indicated they expect to make adjustments soon. Among these changes, 67 percent of South Korean consumers plan to cut back on nonessential goods, signaling a shift toward more frugal and deliberate spending behaviors.
India: Resilient and optimistic
India continues to stand out as a leader in consumer spending across APAC. Intent to spend remains strong and intent to splurge remains at the highest level relative to other countries in the region. This trend spans a variety of discretionary categories, including dining out, jewelry, electronics, and travel, highlighting the resilience and optimism of Indian consumers.
Like their South Korean counterparts, Indian consumers are highly engaged when it comes to tariffs, with 43 percent actively seeking out information on the topic. Moreover, 72 percent of Indian respondents reported that they have already changed, or are expecting to change, their spending behavior due to tariffs. Despite these concerns, intent to spend on travel is on the rise, aligning with the broader trend of increased discretionary spending, particularly in categories associated with leisure and lifestyle.
The consumer landscape across APAC reflects a complex interplay of economic pressures, cultural nuances, and shifting priorities. While markets like India showcase robust spending across discretionary categories, others, such as South Korea, highlight a more cautious approach as consumers navigate economic headwinds. Across the region, factors like tariffs, inflation, and evolving spending habits continue to shape consumer behavior in unique ways.
As businesses look to engage with APAC consumers, staying attuned to these diverse trends and adapting to local market dynamics will be key. For more insights and updates on the state of the APAC consumer, visit our ConsumerWise page or contact us for additional information.
