Macroeconomic July: The Cumulative Impact Of Tightening Will Continue To Emerge.

This year, the central bank has raised the deposit reserve rate for the 6 time in a row, and has raised the benchmark rate of deposit and loan for the three time. Two quarter economy The growth rate dropped from 9.7% in the first quarter to 9.5%, and the decline in economic growth was the result of the weakening of external demand and the combined effect of domestic tightening policies. Because the tightening policy has a lag effect on the real economy for one to two quarters, and inflation is at a three year high of 6.4% in June, the tightening policy will continue to maintain, and the cumulative impact of tightening on domestic demand will further emerge in the three quarter. According to historical experience, if M2 growth -GDP growth rate -CPI growth is less than 2%, we can think of money supply into the tightening cycle.

In the first quarter of this year, this index was 1.9%, and the two quarter index dropped to 0.7%, indicating that the first quarter has entered. Tightening cycle In the two quarter, the tighter monetary supply deepened. In the 2004-2005 year tightening cycle, M2 growth -GDP growth rate -CPI growth in less than 2% interval for 4 quarters, the economic slowdown continued for two quarters, and the deceleration rate is relatively large. In the 2007-2008 year tightening cycle, M2 growth rate -GDP growth -CPI growth in less than 2% interval for 7 quarters, the economy slowed down 7 quarters, affected by the US subprime mortgage crisis, the economic deceleration rate is very large. Referring to historical experience and combined with the current inflation situation, we expect that the current tightening cycle will continue until the end of the year, and the economic growth rate in the second half of this year may decline further. The growth rate of investment rose from a rise to a decline, and the export growth rate continued to drop. In June, the fixed asset investment in the whole month dropped from 26.7% last month to 25.1%, ending the previous 5 months' growth. In the first half of this year, the long-term loans of non-financial institutions increased by 1 trillion and 430 billion yuan, up by 1 trillion and 320 billion yuan from the same period last year, a decrease of 48% over the same period last year. Due to the direct correlation between medium and long term loans and fixed assets investment of non-financial institutions, a significant increase in the number of medium and long term loans means that the momentum of expansion of fixed asset investment may continue to decline. Export growth in the two quarter declined for three consecutive months, and exports in June increased by 17.9% over the same period last year. The growth rate dropped 1.5 percentage points from the previous month. At present, the European debt crisis is likely to deteriorate further, the US unemployment rate is running high, the fiscal stimulus is constrained by the pressure of public sector debt, the weakening of economic recovery momentum may continue, and with the pressure of RMB appreciation, China's export growth may decline further in the second half of the year. In the two quarter, the total retail sales of consumer goods after the deduction of price factors increased slightly in real terms from three in March to 4, 5 and 11.8%, 11.4% and 11.2% in June respectively. In the first half of this year, the per capita disposable income of urban residents increased by 7.6% in real terms, and the growth rate was 0.2 percentage points lower than that of the previous year. Consumption growth It is difficult to pick up.

Industrial production sector continued to increase inventories of finished goods

In June, investment growth slowed down, export growth continued to fall, and the actual growth rate of consumption continued to fall, but the growth rate of industrial added value rose from 13.3% last month to 15.1%. The slowdown in aggregate demand and the acceleration of industrial production indicate that some of the products that accelerate production form the finished product inventory in the industrial sector. In the 3, 4, 5 and June, the PMI inventory index of finished goods in China's logistics and purchasing Federation was 51.3, 50.8, 50 and 51, respectively, running at 50 and above for 4 consecutive months, indicating that inventories of finished goods continued to increase. Over the same period, the inventory of finished goods in Industrial Enterprises above designated size increased from 1-2 in 22% to 22.6% in 1-5. In the second half of this year, with the further slowdown in aggregate demand growth, the de stocking process may cause industrial production to slow down again.