We Should Not Lose Sight Of The Fact That We Should Cope With The Aggravation Of Deflation.

What China is facing now

The pressure is further aggravating.

In February 1st, China's logistics and purchasing Federation and the National Bureau of Statistics jointly released data showing that in January this year, China's manufacturing PMI index was 49.8, the 28 month low since September 2012.

And yesterday, China's HSBC manufacturing PMI in January was 49.7, and it was less than 50 in second months.

In the short term, the decline of the PMI index in January this year may be attributed to the seasonal reduction of production in the long holidays of the Spring Festival. However, the PMI index spanned more than two years of low innovation, but it is a fact that can not be ignored. This shows that the pressure of China's macro-economic pressure is increasing over the past few years. What's more, in the 5 sub indices that constitute PMI, the production index, the new order index and the supplier delivery time index are higher than the critical point, and the employment index and raw material inventory index are below the critical point pattern. It has fully demonstrated that the real demand side's decline is the structural factor of the low PMI index in January this year, compared with the seasonal factors of the Spring Festival holiday.

The index is lower than the critical point, which is more conductive to the deflationary pressure of China's future economy than the first three sub indices.

In fact, the pressure of the current macroeconomic deflation, apart from the PMI index, can also illustrate the problem of electricity consumption in the whole society.

Data show that in January this year, the whole society's electricity consumption increased by about -7.5% a year. We can also be attributed to seasonal factors. However, the negative increase in total electricity consumption in January this year is a rare thing in recent years.

With many features of deflation aggravated, it seems necessary to increase the intensity of "economic stability" in order to avoid the hard landing of our economy. However, whether from past experience or from the effectiveness of the measures already introduced in the current round of economic downturn, China's current "enlarging economic stability" space has been narrowed.

From past experience, in 2008, after the outbreak of the US subprime crisis, in order to avoid a significant impact on China's economy, China issued a high of 4 trillion in 2009.

But with today's view, the effective period of the last round of large-scale economic stimulus is not only very short, but also more fatal, which has further distorted the economic structure of China since then, and has built up a more systematic economic risk to this day.

Then, in the past year, our country has promulgated the "economic stability" measures, although the conventional monetary easing policy is only shown as a rate cut, but in fact, the directional reduction has been issued many times, and during the same period, the reverse repurchase has been launched frequently to release the liquidity to the market. Since the second half of last 12 months, the central bank has accumulated a total of 855 billion yuan of liquidity funds to the market.

However, the relatively loose monetary policy has not achieved the expected effect of "economic stability" in the past year, and the signs of further downward macroeconomic pressure and deflation pressure are even more obvious.

In the face of the further aggravation of deflation pressure and the continuous increase of the downward pressure on the economy, it is necessary to further introduce certain economic stimulus, but it must be moderately controllable so as to prevent the macroeconomic hardship. Lu Weiyi, on the economic stimulus item selection, can not continue the previous "iron public base" mode, but should turn to the people's livelihood protection projects.

We must recognize the logical relationship between economic stimulus and deepening reform, and we must not lose sight of it. Once again, our economy will enter a vicious circle of stimulus and distortion. Economic stimulus is only focused on short-term means. Deepening reform is to stimulate the vitality of our economy, which is the foundation for the long-term and sustainable development of our economy.