Ouyang Xiaohong
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What is the wind direction of the upcoming start of 2024?
2023 is a year of steady progress under the "triple pressure" of shrinking demand, impulse supply, and weakening expectations2024 will be a year of seeking progress while maintaining stability, promoting stability with progress, and establishing first and then breaking down. At the same time, the dialectical relationship between "stability" and "progress", "establishment" and "breaking" is based on the coordinate system of promoting the economy to achieve effective qualitative improvement and reasonable quantitative growth, which will depict a blueprint for Chinese-style modernization.
2023 is coming to an end, and the good news is that on December 14, after the Fed released the "dove", the global financial market index also climbed. On the same day, the Dow Jones Industrial Average rose 043%, the Nasdaq index rose 019%, and the S&P 500 rose 026%, international oil prices and gold prices rose by more than % respectively.
The haze that hangs over the global financial market is gradually dissipatingIn the early morning of December 14, Beijing time, the Federal Reserve interest rate meeting decision showed that the federal target interest rate was maintained at 525%-5.50% range.
According to Cinda's analysis, the Federal Reserve's interest rate meeting in December mainly released two pieces of information: first, the ** decision was landed, and the interest rate hike cycle was reconfirmed at the end of the period. Although the Fed has not yet decided on the timing of the rate cut, this meeting discussed the rate cut, and the overall signal was released. Second, the December dot plot suggests at least three rate cuts next year. Although Fed Chairman Jerome Powell said that he did not want to rule out the possibility of continuing to raise interest rates, investors did not agree with Powell's hints.
The bad news is that the collapse and restructuring of the international order under the influence of technological variables is becoming more and more obvious, and the intensification of geopolitical conflicts has brought more uncertainty.
The external market is like this, behind the short-term peace and heating up of the financial market, there is actually a high wind and waves, and only by taking precautions and moving forward can we deal with it.
At this time, the eyes are set to the east. The ** Economic Work Conference held in Beijing on December 11-12, 2023 put forward the "five musts". The first place is "we must adhere to high-quality development as the last word in the new era", and the three "musts" in the middle are "we must insist on deepening supply-side structural reform and focusing on expanding effective demand and make concerted efforts", "we must insist on relying on reform and opening up to enhance the endogenous driving force of development", "we must adhere to high-quality development and high-level security and benign interaction", and the finale is "we must take the promotion of Chinese-style modernization as the biggest politics".
Economic development needs a material foundation, and development is the last word at any time, but the new economy needs the "hard (core) development" of science and technology and the advanced human and ecological environment. The current context emphasizes high-quality development in the new era - focusing on quality and efficiency, sustainable and comprehensive economic development, rather than focusing on the expansion of growth rate and scale, and emphasizing the pursuit of simple and rapid GDP growth.
II. II. II
Just as the hard (core) development remains the same, what has changed is the ecological environment, internal and external vitality, development model and concept of development.
In the context of the mutual promotion of politics and economy, the concept of economic governance has also been deepened and updated. Hard development aims to propel China's economy towards a more prosperous and sustainable future.
In the macro context of the acceleration of population aging and the irreversible "high-risk society" (high-tech risks, environmental pollution and ecological disorders, infectious diseases, potential economic crises, and intensification of geopolitical conflicts), the old model and old momentum of pursuing speed and scale have faded and are almost "unable to run".
High-quality development requires economic development to pay more attention to the requirements of innovation, green development, structural optimization, and efficiency improvement, and to improve the quality of life and happiness of the people. High-quality development emphasizes the coordinated development of economic development with society and environment, and pursues sustainable development of economy, society and environment.
This is also the essence of "adhering to high-quality development as the last word in the new era" emphasized by the first economic work conference.
* The Economic Work Conference pointed out that it is necessary to enhance the consistency of macroeconomic policy orientation. Strengthen the coordination and cooperation of fiscal, monetary, employment, industrial, regional, science and technology, environmental protection and other policies, incorporate non-economic policies into the assessment of the consistency of macro policy orientation, strengthen policy coordination, and ensure that the same direction is exerted and a joint force is formed.
For fiscal policy, the economic work conference requires that the active fiscal policy should be moderately strengthened, and the quality and efficiency should be improved. It is necessary to make good use of the fiscal policy space and improve the efficiency of funds and the effectiveness of policies. Optimize the structure of fiscal expenditures and strengthen the financial guarantee for major national strategic tasks. Reasonably expand the scope of local ** special bonds to be used as capital. Implement structural tax and fee reduction policies, focusing on supporting scientific and technological innovation and manufacturing development.
For monetary policy, the Economic Work Conference requires that a prudent monetary policy should be flexible, moderate, precise and effective. Liquidity should be kept reasonable and abundant, and the scale of social financing and the amount of money should match the expected targets of economic growth and the highest level. We should give full play to the dual functions of monetary policy tools, revitalize the stock, improve efficiency, and guide financial institutions to increase support for scientific and technological innovation, green transformation, inclusive small and micro enterprises, and digital economy. Promote the steady and moderate decline of comprehensive social financing costs. Maintain the basic stability of the RMB exchange rate at a reasonable and balanced level.
Among them, it is worth noting that the ** economic work conference clearly regarded the "** level expected target" as one of the goals that monetary policy needs to target. Some market participants believe that the macroeconomic control decision-making department may be aware of the risk of potential deflationary hazards, and may introduce targeted policies in the future.
Lu Ting, chief economist of Nomura China, analyzed that it is too early to say that the economy has bottomed out. He expects China to significantly adjust its policy measures sometime in the spring of 2024.
In 2024, focusing on promoting high-quality development, the ** Economic Work Conference emphasized that we should highlight the key points, grasp the key, and do a solid job in economic work. The first place is "leading the construction of a modern industrial system with scientific and technological innovation".
The meeting pointed out that it is necessary to promote industrial innovation with scientific and technological innovation, especially to promote new industries, new models and new kinetic energy with disruptive technologies and cutting-edge technologies, and to develop new quality productive forces. Improve the new first-class system, implement high-quality development actions for key industrial chains in the manufacturing industry, strengthen quality support and standard guidance, and improve the resilience and safety level of the industrial chain. It is necessary to vigorously promote new industrialization, develop the digital economy, and accelerate the development of artificial intelligence. We will build a number of strategic emerging industries such as biomanufacturing, commercial aerospace, and low-altitude economy, open up new tracks for future industries such as quantum and life sciences, widely apply digital intelligence technology and green technology, and accelerate the transformation and upgrading of traditional industries. Strengthen applied basic research and cutting-edge research, and strengthen the main position of enterprises in scientific and technological innovation. Encourage the development of venture capital and equity investment.
What is New Qualitative Productivity?** The relevant responsible comrades of the Finance Office said that the new quality productivity is a contemporary advanced productive force born by technological revolutionary breakthroughs, innovative allocation of production factors, and deep industrial transformation and upgrading.
The effective transformation of new quality productivity requires all-round strengthening of scientific and technological innovation, promotion of industrial upgrading, construction of digital economy, cultivation of emerging industries, and encouragement of innovation and entrepreneurship to form a convergence effect.
At the same time, the first economic work conference requires that the social security net be tightly woven and the social assistance system of stratification and classification should be improved. Accelerate the improvement of the birth support policy system, develop the silver economy, and promote the high-quality development of the population.
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So, what is the current microeconomic and market trend?
The economic data is mixed, and the a**field continues to compete with reality**. In the global market, after the Fed released the "dove", the market was jubilant. Some analysts believe that the soft landing of the U.S. economy has become the most crowded transaction on Wall Street at present, but it may be wishful thinking, because of the expectations of investors in the past three years, and then they were slapped in the face.
Financial data released by the central bank showed that new RMB loans were 109 trillion yuan, an increase of 1 in the same period last year21 trillion yuan;The scale of new social financing is 245 trillion yuan, an increase of 1 in the same period last year98 trillion yuan.
Xiong Yuan, chief economist of Guosheng**, analyzed that credit growth in November was lower than expected, and the growth of social financing scale was basically in line with expectations. Structurally, short-term loans and mortgage loans for residents are significantly lower than seasonal, the impulse characteristics of short-term loans and bills for enterprises continue, and the growth rate of narrow money has also fallen to a historical low.
Xiong Yuan believes that the general tone of the policy in 2024 will be expansionary and stimulusive, specific to the monetary side, easing or the general direction, and the possibility of short-term RRR and interest rate cuts will be greatly increased (as soon as December).
Zhu Haibin, chief economist of JPMorgan Chase China**, China's fiscal deficit may remain at 3 in 20248%, the People's Bank of China cut interest rates by 10 basis points and cut the reserve requirement ratio by 75 basis points.
However, there is no movement on monetary policy for the time being. The MLF (Medium-Term Lending Facility) interest rate in December was unchanged from the previous month and has remained unchanged for four consecutive months.
On December 15, in order to maintain reasonable and sufficient liquidity in the banking system, hedge the impact of short-term factors such as bond issuance and payment, and appropriately maintain the medium and long-term base currency, the People's Bank of China carried out an open market reverse repurchase operation of 50 billion yuan and an MLF operation of 1.45 trillion yuan, and the interest rates were maintained respectively5% unchanged. Because 650 billion yuan of MLF expired in December, MLF continued to achieve a continuation of "volume increase and price parity", and the net investment volume hit a new high in the year.
In this regard, Wen Bin, chief economist of China Minsheng Bank, explained that there are four reasons: to alleviate the expectation of tight liquidity and strengthen the coordination of monetary and fiscal policies;Alleviate the medium- and long-term liquidity pressure of the banking system and stabilize support for the real economy;The interest rate on interbank certificates of deposit remains high, far exceeding the MLF interest rate, and the demand for MLF by banking institutions has increased significantlyUnder multiple considerations such as efficiency improvement, air defense transfer, and exchange rate stabilization, the space of traditional aggregate tools has narrowed, and MLF and other incremental sequels have become the current policy choice.
In Wen Bin's view, in order to alleviate the downward pressure on the pricing of banks' assets, maintain bank interest margins and profits at a reasonable level, and resolve real estate and local debt risks for banks to retain strength, the MLF interest rate remains unchanged.
Economic data for November showed that China's economy may show a moderate recovery. According to Zhong Zhengsheng, chief economist of Ping An**, in November 2023, the year-on-year growth rate of major economic growth data mostly maintained a recovery momentum. In November, the year-on-year growth rate of industrial added value, service industry production, total retail sales of consumer goods, and fixed asset investment all increased compared with October. Considering the optimization of domestic epidemic prevention and control policies in the same period last year, the increase in the low base cannot be ignored. Judging from the two-year average growth rate, the growth rate of social zero and real estate investment fell significantly in November.
According to Zhong Zhengsheng's analysis, manufacturing production continued to recover, and the growth rate of investment also increased. Industrial added value increased by 6 percent year-on-year in November6%, an increase of 2 percentage points from October;As the main part, the year-on-year growth rate of the added value of the manufacturing industry increased by 1 compared with October5 percentage points to 67%。
However, the decline in real estate investment narrowed slightly. The year-on-year growth rate of real estate investment in November rebounded slightly by 08 percentage points to -105%。According to Zhong Zhengsheng's analysis, there are two reasons: on the one hand, there is support from the low base in the same period last year, and the month-on-month growth rate of real estate investment in November is weaker than the average of the same period from 2018 to 2021;On the other hand, the financing policy support for real estate enterprises has been strengthened, and the marginal improvement of the capital side has been improved.
Zhong Zhengsheng noted that the year-on-year growth rate of new construction area in November reached 48%, from negative to positive. However, as a leading indicator of new construction, land transactions in Baicheng have not yet recovered from the trend, and the inventory of commercial housing continues to accumulate, and the potential for improvement of new construction starts remains to be seen.
In terms of household consumption, travel and service consumption were relatively strong, and the year-on-year growth rate of total retail sales of consumer goods in November increased by 25 percentage points to 101%。
and a year-on-year decrease of 05% of the CPI (Household Consumption ** Index) data for November and a 3.-year decrease in the same period last yearThe 0% PPI (Industrial Producers** Index) for November showed that prices weakened again. Some market participants reminded that it is necessary to guard against the hidden dangers of deflation.
At this time, looking back at the eternal economic theme of "development", although development requires an economic foundation, is everything possible in the era of AI intelligent big data?
According to the analysis of market views, no matter what period it is, we cannot ignore the requirements of high-quality development. Focusing only on economic growth and ignoring quality can pose some potential risks. To a certain extent, high-quality development does not completely depend on the basis of economic growth, but pays more attention to the quality and efficiency of economic development. Although economic growth can provide a certain foundation for high-quality development, it is not the only determinant. If faced with the risk of deflation, ** can achieve high-quality development by adopting appropriate macroeconomic policies to stabilize the economy, or promote economic restructuring and optimization, promote innovation and technological progress, and improve production efficiency and quality.
However, the premise of high-quality development is obviously to ensure economic stability and solve people's livelihood problems. The "tightly woven social security net" required by the first economic work conference is the cornerstone of the economic foundation, and the foundation of people's livelihood security is consolidated, and development can be truly "hard core".