The Current Level Of Interest Rates Is Basically Reasonable &Nbsp, And Money Growth Will Pick Up.

Because of the global

In the 1-7 month, the added value of above scale industries increased by 14.3% compared with the same period in 1-6.

In July, the added value of above designated industries increased by 14% over the same period last year, down 1.1 percentage points from June, an increase of 0.6 percentage points over the same period last year.

In July, the added value of above scale industries increased by 0.9%, and the annualized growth rate fell from 18.7% to 11.4%.

Data show that the industrial growth rate has slowed down, in line with our previous judgement of growth trend, but lower than the market and we expected 14.5%.

Slowdown in demand and energy conservation and emission reduction policies led to slower industrial growth.

In July, fixed asset investment and consumption demand further slowed down, indicating that the weakening of domestic demand power led to a decline in industrial growth.

Among them, the growth rate of light industry dropped by 1.1 percentage points respectively.

On the other hand, by the summer power restriction, traditional maintenance seasonal factors and energy saving and emission reduction policies and other factors, the growth of electricity consumption in the past 7-9 months will slow down, which is also partly responsible for the decline of industrial growth in July.

In July, industry data showed that the impact was obvious.

In the 9 main industries announced by the Statistics Bureau, except for pportation equipment and textile industry, the growth rate of heavy chemical industries such as chemical raw materials, non-metal products, iron and steel and thermal power production has slowed down to varying degrees from the previous month.

Production of general equipment manufacturing, electrical machinery and equipment manufacturing has slowed down due to reduced demand for replenishment.

Judging from the output of major industrial products, power generation, cement, crude oil processing, ethylene, automobiles, and ten non-ferrous metals and other heavy chemical industry products grew at a slower rate than the same period in the same period, reflecting that the growth rate of heavy chemical industry production is slowing down.

In 1-7 months, the investment in fixed assets of urban areas increased by 25.4%, which basically met market expectations, a slight decrease of 0.2 percentage points from the previous month. In July, investment in single month dropped by 0.5 percentage points.

As PPI increased in July compared with June, the actual investment growth in July dropped by 0.6 percentage points from the previous month. Under the tight policy environment, the actual investment growth has dropped.

The progress of affordable housing has been accelerated, and real estate investment has rebounded.

Under the policy tightening and economic slowdown, investment growth did not fall sharply, mainly because real estate investment remained relatively fast growth. Compared with the same period, investment growth in 1-7 months was 33.6%, and the growth rate was 0.7 percentage points faster than that in 1-6 months.

Structurally speaking, there has not been a marked improvement in the capital side of commercial housing. In the 1-7 month, the loans for commercial housing investment increased by 6.4% compared with the same period last year.

In the tight chain of funds, real estate developers accelerated the progress of sales and sales rebounded.

The sales area increased by 13.8% in 1-7 months, 1 percentage points faster than that in 1-6 months.

Another more important factor is that in the second half of this year, with the increase of policy intensity, the progress of housing construction has been markedly accelerated.

In 1-5 months, the rate of affordable housing starts is less than 34%, and at present, the rate of affordable housing has exceeded 50%. The current intensive housing construction is an important reason for the rebound in real estate investment in 7 months.

In terms of industry,

We expect investment growth to drop slightly in the future, but there are still more structural highlights.

At present, the growth rate of new construction projects is below 20%. Taking into account the 3-6 month lead period of the new projects, the growth rate of investment in the second half of this year is expected to further converge to the growth rate of the new construction, that is, it will continue to fall slightly and remain at about 24.8% throughout the year.

Structural investment growth is still bright spot: first, infrastructure investment has been accelerated.

In the first half of the year, capital investment projects were restrained by the purpose of controlling inflation. Policy adjustments will accelerate investment.

Especially in the field of irrigation and water conservancy investment, water conservancy investment in the first half of the year is only about 120 billion. According to the plan of investing 3000-4000 billion this year, water conservancy construction will peak in the three or four quarter. It is estimated that the annual investment will increase by more than 80%. Two, with the adjustment of policies, the investment in manufacturing industry will rebound.

At present, the inflation trend has basically taken shape. Under such circumstances, the tightening pace of monetary policy will be significantly weaker than the first half, and fiscal policy will continue to exert strength in the protection of housing, water conservancy construction and emerging industries.

In the July NDRC approval projects, new industries such as new energy and new materials increased significantly, and the first half of the approval projects were mostly concentrated in farmland water conservancy and investment in infrastructure construction in the central and western regions.

The adjustment of fiscal policy has come to light.

In terms of consumption, retail sales are slowing down.

In July 2011, the total retail sales of consumer goods increased by 17.2% over the same period last year, down 0.5 percentage points from June, lower than that of our market and 17.5%.

Taking into account the level of inflation, real consumption growth in July was 11.3%, down 0.6 percentage points from last month.

In July, the total retail sales of consumer goods increased by 1.26%.

On the whole, overall consumption is still on a weak trend. The growth rate of durable consumer goods, such as automobiles and appliances, is slowing down. We expect this trend to last until the end of the year.

durable

The tension between supply and demand in the labour market has eased.

On the whole, there is no large-scale unemployment in the labor market. Although the overall labor demand has slowed down along with the economic downturn, it is still in a state of tight labor supply.

In the two quarter, the ratio of actual job vacancies to job seekers was 1.03, down 0.04 from the previous quarter, up 0.03 compared with the same quarter last year.

In the two quarter, the proportion of job vacancies and job seekers in the eastern and western regions declined, but the central region maintained a continuous upward trend, indicating that the speed of domestic industrial pfer has accelerated significantly, and more labor-intensive industries are moving to the central part of the cost more comparative advantage, increasing the demand for local labor.

According to the industry, compared with the two quarter of last year, the demand for labor in manufacturing industry increased, and the demand for labor in construction industry showed a significant decline, which is consistent with the current trend of infrastructure investment falling.

Annual retail sales are expected to grow at around 16.8%.

Although the current employment situation is still good, the turbulence of the overseas situation will increase the uncertainty of residents' income growth in the future. Taking into account the demand for durable goods to maintain a weak pattern, we expect that the annual retail sales growth will remain at around 16.8%.

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Inflation will soon drop.

Rising food prices pushed CPI higher and cost push inflation pressure dropped.

Similar to the situation in June, the anti seasonal rise in food prices is still a major factor contributing to the increase in inflation, especially in the low consumption season, which has led to rising food prices.

If the factors of pork prices rise, the CPI level since last November basically remained at 4.5-5% level, and the price in July was about 5% in June.

In addition, it is worth mentioning that since the end of June, the increase in food chain has actually slowed down significantly, but as the price of food in June has increased in the last ten days, the base of the whole month has been on the low side. Therefore, the average ratio of July to June is still at a high level.

The trend of non food prices is stable. In July, non food prices rose by 0.1 percentage points, indicating that under the economic slowdown, the driving force of non food prices continues to rise.

From the PPI and purchase price index, upstream prices began to fall, and cost driven inflation pressure dropped significantly.

We believe that July will be the climax of the current round of inflation. Although the level of inflation has reached a new high in July, the driving force for future growth will be significantly weakened.

First, the economic growth rate has dropped. In July, the industrial growth rate was only 11.4% lower than the annual rate. Secondly, the import inflation reversed, and the commodity prices fell sharply; third, the domestic food prices were expected to decline. From the food perspective, the food growth in July has slowed down significantly, especially the pork price has dropped slightly, and is expected to continue to fall in the future.

We expect that the driving force for price rise will further decline in August, with CPI expected to be around 5.8% in August. It is estimated that in the four quarter, CPI will drop to around 4%, and it will be around 5% in the whole year.

It is expected that the PPI will decrease in August, and the PPI will increase by 6.9% in August, while the PPI will remain at about 6.5% in the three quarter.

Monetary policy is expected to turn to stability.

Monetary policy is expected to shift from austerity to stability.

First, the global financial market turmoil has exacerbated the uncertainty of the global economy, and the global economic growth is likely to decline. The European and American economies are suffering from debt problems and are expected to grow faster than in the first half. This increases the risk of falling foreign demand.

Second, domestic economic growth has continued to decline, and domestic demand growth slowed in July.

Third, inflation pressures will slow down, and we expect that the downward trend has been determined.

If policy continues to tighten, the superposition of regulatory effects and external shocks may lead to greater fluctuations in China's economy.

Therefore, we believe that monetary policy will shift from tight to stable in the future, and we will not rule out a fine adjustment of policies.

We expect that interest rates will not be increased during the year, and the current interest rate level is basically reasonable.

On the one hand, inflation will decline in the future, and the negative interest rate may change in the fourth quarter or the first quarter of 2012. On the other hand, the profitability and loan interest rates of enterprises are basically the right ones, and there is no need to raise interest rates to reduce investment momentum.

Taking into account the uncertainty of the overseas economic situation, the global monetary policy may further relax, and China's monetary policy must be constrained by this constraint.

The deposit reserve policy is temporarily frozen, and the possibility of further improvement in the future will be significantly reduced.

The deposit reserve policy may not be launched in the short term. On the one hand, it is pessimistic about the economic forecast, and raising the reserve will increase the pessimistic anticipation, which will lead to the domestic economic fluctuation. On the other hand, the turmoil in the overseas financial market may lead to the reflow of funds from developed countries to developed countries in order to cope with the turbulence in the financial market. This may lead to a decline in the growth of China's foreign exchange holdings, resulting in a decrease in the new basic currency, resulting in a temporary freeze on the reserve policy.

Money growth has rebounded.

As the domestic economy continues to fall, inflation will soon fall, there are difficulties in financing small and medium enterprises, and there is a big gap in demand for housing construction funds. At the same time, global currencies need to increase supply.

The control of China's currency may ease a bit. It is expected that monetary growth will pick up in the future, and the growth rate of M2 in the whole year will probably rise to around 16%.