Overall, The Economy Should Continue To Recover In The Short Term.

For the current economic situation and debate, let's look at the problem.

It's like a car stuck in a mire, unable to move.

The driver gradually increased the throttle and the engine buzzed, and the car remained stationary.

The driver was forced to exert all his strength to step the throttle to the maximum. With the loud roar of the engine, the car rushed out suddenly, and the passengers on the bus felt a strong sense of pushing back, and the passengers and drivers were shocked.

So the passengers began to talk about the driver's skills.

Some people say that the engine roars so badly that it damages the machine and wastes fuel and produces a strong jolting feeling.

Some people say that this is because the vehicle lacks maintenance and maintenance for a long time, and the road is not clear before driving.

Some people say that the feeling of flying is really good. It should be maintained, even faster and so on.

All these arguments may be true.

But it is very clear that the car will not always run like an arrow, its speed will soon slow down, and perhaps there will be new marsh ahead.

Since March, economic activity has rebounded significantly, showing strong acceleration and pushing back.

What is more clear is that this round of "pushing back sense" still comes mainly from the improvement of infrastructure and real estate development investment, as well as the low inventory of related chains, which is accompanied by the expansion of bank credit.

In the early May, an authoritative article in the people's daily expressed concern about the short-term demand stimulation and the high leverage of the real economy.

This means that the focus of next economic policy may shift from pre demand stimulus to supply side structural reform.

In fact, this also shows that the current demand recovery driven by policy is impulsive.

Two. Pulse recovery is not over yet.

From the manufacturing industry PMI, key enterprises, crude steel output, electricity consumption coal and other meso data, the economic kinetic energy in April may be weaker than in March.

But from the historical experience and the latest cement price and sales of commercial housing, the short-term economic recovery process may not be over yet.

For example, despite the recent rainfall in the south, the national cement delivery is still stable and the price is relatively strong.

Some construction enterprises reflect that orders are still positive in the first quarter, and the number of construction projects can be maintained in the two quarter.

In the past month, the sale of first tier commercial housing has dropped at a high level, while housing prices have been lower than ever. However, the two or three line is still positive, and housing prices continue to rise.

In combination, sales area is still maintained on a higher platform, and the rate of de conversion is faster, which is expected to continue to support development and investment activities.

After the elimination of base and price effects, export growth in April was low and stable, and external demand may not be a further drag on economic momentum for the time being.

Some negative changes at the data level should also be noted.

For example, in April, grassroots bank research and bank credit may be weakened, but to a large extent, they are affected by debt replacement, and they need to wait for the final financial data to be released.

4 the aggravation of credit default worries since mid late has also had a certain impact on corporate credit debt financing activities.

In April, PPI was 0.7%, which was higher than in March, and has reached a highs since February 2011.

This also confirms the strong sense of "pushing back" in the economic field in the past period.

The rebound of PPI ring ratio corresponds to the improvement of corporate profits, which has supported the stock market in the past few years.

However, we need to be vigilant that with the gradual weakening of the sense of "pushing back" and the further expansion of the scope of production, we suspect that the upward trend of industrial prices may have been or is failing, and the high point of the PPI round of the current round may have been seen.

The impact on commodities and stock markets deserves attention.

It is worth noting that in recent months, raw material futures spot prices have seen a sharp rise and fall, and the volatility is relatively intense.

This also has a certain impact on other asset prices and market expectations.

The positive factors of macro and industrial fundamentals support the rise in commodity prices since the beginning of the year, but the sharp fluctuations in the latter market should be clearly amplified by sentiment and capital strength.

In some varieties, traders' hoarding behavior may exacerbate the previous rally, and subsequent selling led to a small scale of stampede.

April CPI year-on-year 2.3%, unchanged from the previous month, in line with market expectations.

Pork prices continued to rise, up from a year ago.

However, the price of live pigs has begun to fall, and it is estimated that pork will also go down in the next few months.

As the weather turned warmer, the price of fresh vegetables fell sharply in April.

The price of fresh vegetables should have passed.

Further considering the possibility of fresh vegetables for a small year, the price of fresh vegetables is lower than that of the same year.

This year's rainwater may have a greater impact on fresh vegetables and some grain production. This risk deserves our attention.

But from historical experience, weather disturbance is not easy to become the dominant force of price trend.

In combination, although there is still some pressure on the pork market even though the trend of industrial price changes remains to be confirmed, with the price of vegetables going higher, it seems that the general consumer price climbing process has ended, and the market's concerns about inflation will gradually ease.

Since late April, the recognition of economic fundamentals and the risk of credit default have brought about a small liquidity shock to the inter-bank market. The interest rate of funds has risen, bond yields have risen and credit spreads have widened.

After the May 1, with the adjustment of other asset markets, coupled with the easing of the fear of default, the inter bank assets have improved.

1 days and 7 days, the higher interest rate of funds dropped 10BP and 26BP respectively, and returned to the steady level in the past period.

Interbank interest rate bonds and credit bond yields also have a downward trend.

However, given the continuous exposure of credit risks and the impact of tighter regulation and taking into account the possibility of future economic pullback, the pressure of credit spreads will not be significantly alleviated in the short term.

The risk of stampede in the credit debt market can not be ignored.

The spread of credit spreads makes the advantage of interest rate debt prominent.

But the emergence of trend opportunities may still take some time to wait.

In April, new non farm employment in the United States was lower than expected, which further depressed the interest rate futures market's expectation of the Fed's rate hike in June.

However, the trend of employment improvement in the United States remains unchanged, the unemployment rate is stable, and the monthly wage growth is also strong.

On the whole, although the US economic growth is hard to say, its relative advantage is still obvious. This may be a strong support for the US dollar index in the medium term.

The resumption of economic momentum in the euro zone since the start of QE in early 2015 is likely to come to an end.

The British economy has not been improving for several months, and the risk of Euro retreat may also play a negative role in it.

Japan's economic momentum continues to stall.

In recent days, under the strong background of the dollar and the intervention of the Central Bank of Japan, the upward pressure on the yen has eased slightly.

The main emerging economies were weaker in April than in March, and the sustainability of economic recovery is doubtful.

Since the end of April, the capital outflow of emerging countries has risen, the stock market has gone down, and bond yields have gone up.

The focus of economic policy will shift from the early demand stimulus to the supply side structural reform. It also shows that the current policy driven demand recovery is impulsive.

Some indicators in April seemed to show a decline in economic kinetic energy, but industrial prices continued to rise and hit a new high for several years.

Combined with cement prices and historical models, the economy should be resumed as a whole in the short term.

What we need to be vigilant is that with the further expansion of the scope of production, the recovery of industrial prices may be or is failing.

The impact on commodities and stock markets deserves attention.