Combined with the PMI, a leading indicator that was released on the 30th of last month, the overall weakness of economic data in October is already expected. Exports are driven by price factors, continuing the trend of high prosperity, but the marginal growth momentum is basically released; fixed asset investment is still relatively weak due to the continuous decline in real estate investment and insufficient investment in infrastructure; although there are signs of partial recovery in industrial added value and consumption, the overall downward pressure on the economy is still not small. What other increases in the economy are worth looking forward to during the year? What will be the effect of the special debt force? How long will the bottom of the real estate policy be transmitted to the market? Where will monetary policy go? What will be the impact on investment?
The author of this article is an academic member of Pangu Think Tank, such as Guan Qingyou, president of the Institute of Financial Research and chief economist, and the article comes from the WeChat public account of "QingYouTalk of Qingyou Association".
Although the economic data is weak overall, there is no lack of bright spots in the structure
Overall, the October economic data still continued the previous weak trend, but some sectors showed signs of recovery. Although infrastructure and real estate are still weak, the industrial added value and consumption rebounded moderately, becoming the highlight of this month's economic data. At the same time, exports continued to have a high degree of prosperity, and the supporting effect on economic data is still obvious. From the sub-data, external demand is still strong, but the impact of "price" is greater than the "amount", and the overall marginal momentum is slowing down; the cumulative increase in fixed asset investment is 6.1% year-on-year, slightly lower than the expected value of 6.2% and the previous value of 7.3%, still relatively weak; industrial added value increased by 3.5% year-on-year, 3.0% higher than expected, and there have been signs of recovery; the growth rate of social zero is 4.9% higher than the expected value of 3.5% and the previous value of 4.4%, rebounding significantly. Overall, the downward pressure on the economy is still there, but the local recovery has emerged, waiting for special debt to drive infrastructure investment to pick up and policy bottom to drive real estate investment to rebound.
The export data is still high, but the marginal momentum has basically been released
October export data were released earlier this month. According to the data released by the General Administration of Customs, the total export volume in the first ten months reached 17.49 trillion yuan, an increase of 22.5% year-on-year, and the growth rate fell slightly, but the overall trend continued since this year. Judging from the single-month data, the export amount in October was 1.94 trillion yuan, and the total export amount in a single month was the second highest except for September, an increase of 20.3% year-on-year, compared with 19.9% in September, which was 0.4% higher, and the performance was still eye-catching. However, from the month-on-month data, the month-on-month growth of exports in October was only 0.7%, and the growth trend was significantly slower than in previous months, which basically confirmed our previous judgment on the marginal weakening of export kinetic energy. At the same time, with the promotion and popularization of new crown drugs in the United States in the future, overseas production gradually picks up, superimposed domestic production end is repeatedly interfered with by "double control" and the epidemic, the gap between overseas supply and demand is repaired, and the export data at the end of the year will most likely maintain the trend of price increase but volume reduction, the export momentum will be basically flattened, and the high level shock will be the norm in the next few months.
Infrastructure and real estate are still relatively sluggish, and the drag effect on investment is still relatively obvious
The growth rate of fixed asset investment is still falling. Fixed asset investment increased by 6.1% year-on-year from January to October, slightly lower than expected by 6.2%, compared with 7.3% in the previous September and 8.9% in the first eight months. On the one hand, infrastructure investment is still weak, the finance has not yet begun to exert force, although the special debt began to rush this month, but there is still a certain time period from issuance to investment, and the volume effect is difficult to appear in a short time; on the other hand, the real estate downturn has not stopped, although the bottom of the real estate regulation and control policy has appeared, but the marginal weakening of the regulation and control is more for the previous overcorrection of deviations, and the shrinking trend of investment scale is difficult to change in the short term.
Real estate data is still not performing well, although the regulatory policy has been basically confirmed, but in the short term, it is still difficult for the investment side to pick up
Real estate investment in the first ten months increased by 7.2% year-on-year, an average growth rate of 6.8% in two years, significantly lower than the same period of 10.3% in 2019, down 0.4 percentage points from the previous month's two-year year-on-year 7.2%, and the downward trend is still there. Combined with the housing price data of 70 large and medium-sized cities in October that the Bureau of Statistics has previously released, on the one hand, the year-on-year and month-on-month increases have both fallen, the year-on-year increase has fallen from 3.27% in September to 2.84%, and the month-on-month decline has expanded from 0.08% in the previous month to 0.25%, on the other hand, the number of cities with price declines has surged, and the number of cities with house prices in 70 cities has increased from 36 cities in September to 52 cities in October, which is the highest value since February 2015, and the real estate sales end is still relatively cold. The continuous coldness of real estate and the demand-side credit are still tight, and the supply-side regulation and control efforts are not reduced. However, from the policy point of view, the intensity of regulation and control has shown signs of relaxation on the margin, especially at the sales end, one is that the central bank's third quarter monetary policy implementation report mentions "two maintenance", the second is that the director of the financial department of the central bank pointed out that some financial institutions have misunderstandings about the "three lines and four gears" policy, and the third is that the Banking and Insurance Regulatory Commission issued a voice to support the first suite buyers, and the policy tone refers to the "just need" loosening, and then Shenyang, Xuzhou, Wuhan and other cities have introduced purchase restrictions and loosened policies, and some housing demand will also be released. The release of demand is bound to drive future supply-side real estate investment, but from the perspective of policy setting, the discussion of "not using real estate as a short-term means to stimulate the economy" is still being repeatedly mentioned, indicating that the arrival of the current policy bottom is more of a correction rather than a comprehensive relaxation, and the probability of rebound at the future real estate investment end will be relatively limited.
Infrastructure investment is still declining, but special bonds have begun to rush, and the follow-up effect is worth looking forward to
Infrastructure investment in the first ten months increased by 1.0% year-on-year and increased by an average of 1.2% in two years, although it has picked up from the average growth rate of 0.9% in the previous month, but it is still significantly lower than the same period in 2019 of 4.2%. Combined with financial data, a total of 2.8 trillion yuan of special bonds were issued from January to October this year, and 75.2% of the progress of the whole year has been issued, and the issuance progress is significantly behind 2019 and 2020, which can also explain the weak infrastructure construction in the previous October to a certain extent. However, combined with the changes in the progress of the past two months, the squeezed approval of infrastructure projects to be approved has gradually increased, and if the 2021 special bond budget is 3.65 trillion yuan and the Requirements of the Ministry of Finance to complete the issuance of special bonds in November, it is expected that the issuance scale will reach 906.1 billion yuan next month, and the impulse effect will be further obvious, which will form a certain support for infrastructure investment after a period of time. However, there is a certain time lag in the landing of special bonds and infrastructure projects, and it remains to be seen whether infrastructure investment can rebound significantly in the short term.
The prosperity of the manufacturing industry is still high, and the high-tech manufacturing industry and price factors contribute significantly to the manufacturing industry
In the first ten months, manufacturing investment increased by 14.2% year-on-year, an average growth rate of 4.0% in two years, and an average growth rate of 0.4% compared with 3.6% in the previous month, higher than the same period of 2.6% in 2019, and the manufacturing repair process is still continuing. It is worth noting that from the structural point of view, on the one hand, the support of high-tech manufacturing on manufacturing investment is still there, the added value of high-tech manufacturing in the first ten months increased by 19.5% year-on-year, the average growth rate of 23.0% in two years, and the impact of excluding the base effect is still very impressive, compared with 23.5% last month, although there is a decline, but the absolute growth rate is still high. On the other hand, the impact of price growth on manufacturing investment cannot be ignored, the investment in the metal products industry increased by 19.4% year-on-year in the first ten months, and the investment in agricultural and sideline food processing industry increased by 19.9% year-on-year, all of which have a strong correlation with price data.
Consumption shows signs of recovery, CPI rebound superimposed car sales decline narrowing has a certain driving effect on consumption
In October, social consumption was afraid of obvious signs of recovery in total retail sales, up 4.9% year-on-year, higher than expected by 3.5%. On the one hand, the price of pork in October is about to stop falling, the price of fruits and vegetables has risen significantly, and the price factor has played a certain role in supporting consumption. Combined with the October price data, the price of fresh vegetables rose by 16.6% month-on-month, contributing to the CPI increase of 0.34 points month-on-month. Non-food prices rose 0.4% month-on-month, contributing about 0.35 points to the CPI increase; pork prices, down 44.0% year-on-year, but narrowed by 2.9 percentage points compared with the previous month, and the two played a strong role in supporting consumption. On the other hand, the narrowing of the decline in automobile sales also has a certain driving effect on consumption. From the perspective of generalized passenger car sales, the sales volume of generalized passenger cars in October was 1.738 million, down 14.1% from last year, and the decline was significantly narrowed compared with the 17.3% decrease in the previous month. The fourth quarter is the golden time for traditional car purchases, the car purchase base is large, and the narrowing of the sales decline in October has weakened the obvious effect of consumption drag, and there is a certain positive effect on the recovery.
"Stagnation" is still there, "swelling" has not gone, we must learn to coexist with the era of "stagflation-like"
From the perspective of monetary policy, the authorities are still standing still, and the internal economic regulation and control means are mainly concentrated in precision drip irrigation such as targeted wide credit and targeted tax mitigation, and there is a high probability that there will be no comprehensive easing during the year. Although the central bank has announced the launch of a green financial carbon emission reduction tool this month, such targeted easing is difficult to understand as structural easing for short-term economic regulation and control, with limited support for the medium and short-term economy, and the current monetary policy is still maintaining a tight balance, and can only wait for the policy to be further implemented.
From an investment point of view, now the external Federal Reserve officially announced Taper, although it was announced that the boots landed on the us stock market on the same day, but the long-term "blunt knife cutting meat" effect will gradually become prominent, superimposed on the internal tight balance of monetary policy, incremental funds are very limited. At the same time as high prices, although the economy has a local recovery, but the overall downward pressure is still not small, the overall performance of A-shares valuation double killing risk still exists, the capital market is more of a stock capital game, the plate style switch is still very fast, the so-called structural opportunities are difficult to grasp. ■
The article comes from the "Guan QingyouTalk" WeChat public account
Photo editor: Dong Yixuan
Editor-in-Charge: Wang Yibo