As China ushers in the Year of the Horse this week, officials are placing new hope in an extended, nine-day Lunar New Year holiday to help stimulate the slowing domestic economy and encourage consumer spending across the country. The annual Spring Festival travel period, known as chunyun, is underway with predictions of unprecedented movement of people and rising holiday consumption, even as broader economic challenges persist.
This year’s chunyun — a period that has become the world’s largest annual human migration — began on February 2 and will continue for 40 days encompassing the official public holidays from February 15 to February 23. Authorities are forecasting a record-breaking 9.5 billion domestic passenger trips during this stretch, surpassing last year’s figures and underscoring the extraordinary scale of population movement that traditionally marks the festival. Hundreds of millions of Chinese are either returning home to reunite with family or taking advantage of the longer break for leisure travel.
The travel rush is seen domestically as not only a cultural event but a significant economic indicator. It tests the capability of China’s transport infrastructure and reflects the vitality of consumer demand. According to official counts, railways alone had carried over a billion passengers by early February, while civil aviation saw millions of travelers in the first week of the period. Domestic highways, trains and flights are all operating at high capacity as Chinese citizens make their seasonal journeys.
Beyond sheer travel figures, there is a noticeable shift in how people are celebrating the holiday. Unlike past years when travel was primarily one-way — from urban work centres back to hometowns — this year’s movement has evolved into a more bidirectional pattern, with many people continuing on to tourist destinations after family visits. Travel patterns show strong demand for a mix of tropical locales such as the southern island of Hainan and winter destinations like Changbai Mountain in the northeast. International travel has also surged, supported by expanded visa-free policies with more than 45 countries — a policy shift that has seen Chinese tourists flock to destinations such as Thailand and Australia.
Officials hope this surge in mobility and tourism will translate into heightened consumer spending. To further bolster demand, the central government has announced the distribution of 360 million yuan in consumer vouchers intended to stimulate purchases in retail, dining, entertainment and other service sectors. Analysts note that sectors such as healthcare, elderly care and entertainment have already shown promising growth and could benefit significantly from festive spending.
However, China’s broader economic landscape still faces challenges. High household savings rates and slower retail sales growth — retail expansion in 2025 lagged behind overall GDP growth — indicate ongoing concerns about domestic consumption strength. Household savings remain unusually strong, dampening the full effect of fiscal measures aimed at boosting spending. As a result, authorities are making efforts to strengthen internal demand through a suite of longer-term economic plans, including new initiatives to invigorate service industries and encourage household spending.
Cultural trends during the holiday also reflect changing tastes and social dynamics. Traditional celebrations such as the exchange of red envelopes remain popular, but modern activities like cinema outings are increasingly significant. Last year’s blockbuster success of films like Ne Zha 2 highlighted the growing role of entertainment in holiday consumption, and this year’s anticipated releases are expected to continue drawing large audiences.
Yet not all developments surrounding the festival have been positive. In the days leading up to the celebrations, a fireworks store explosion in Jiangsu province resulted in multiple fatalities, underscoring safety concerns even as festivities begin. Authorities are moving to tighten oversight on fireworks production and use in response to such incidents.
Overall, China’s extended Lunar New Year celebration in 2026 has become a focal point for efforts to ignite domestic economic momentum while preserving cherished cultural traditions. With record levels of travel and a hopeful boost in consumption, authorities and businesses alike are watching closely to see whether the festive season can deliver both festive joy and meaningful economic impact.
