Looking Forward To The 2018 Half Of China'S Economy, The Six Major Trends Need To Be Grasped.

After the release of macroeconomic data in May, some data aroused widespread concern in the community.

In addition, Sino US trade friction is expected to rise, and there is a certain pessimism in the market.

We believe that despite the dual challenges of structural leveraging and Sino US trade frictions, the macroeconomic situation will remain unchanged in the second half of this year.

From points

In terms of industrial production data, the growth rate of cyclical industries rose from about 0.8% at the end of last year to about 3.3% in April, and the rate of recovery rose to 4.1 percentage points, stimulating the overall industrial growth by 0.63 percentage points, and contributing 90% to the overall industrial recovery.

In the second half of the year, commodity prices will continue to fluctuate upward.

Will continue to maintain rapid growth.

With the support of pformation and upgrading and massive R & D investment, the high technology industry will also maintain steady and high-speed growth.

In addition, infrastructure investment will stabilize demand support for industrial growth. In the second half of this year, with the acceleration of local bond issuance, capital constraints faced by infrastructure investment will be alleviated to a certain extent, and the sharp decline of infrastructure investment will be reversed, which will drive demand for industrial growth.

In June 27th, in Xi'an BYD pure electric bus base, workers installed accessories in a K8S pure electric double deck coach.

In May 1st, the value added tax reduction of manufacturing, pportation, construction and other industries and agricultural products was formally implemented, and dividend policy is expected to become a new driving force for growth.

However, due to the impact of Sino US trade friction, the growth of equipment manufacturing industry is facing a test.

From the first batch of tax goods announced by the United States, it mainly focuses on cars and their accessories, electronic circuits, industrial equipment, mechanical parts and other similar commodities.

Affected by this, the growth pressure of machinery and equipment manufacturing industry in the second half of this year has increased sharply.

Growth of service sector has potential

In May, the service business activity index was 54%, an increase of 0.2 percentage points from last month, 0.5 percentage points higher than that of the same period last year; the new order index of service industry reached 50.4%, an increase of 0.1 percentage points from the previous month, indicating that the market demand remained expanding.

The business activity index of air pport, postal express, telecommunications, Internet software and other industries continued to be above the high economic boom of more than 60%; the traditional business activities index such as retail and accommodation were higher than the overall level of service industry.

In the second half of the year, the main industries will continue to maintain rapid growth. In May, the information pmission, software and information technology service industry continued to grow at a high speed, and the growth rate reached over 30%, and the trend was constantly increasing. It was the main driving force for the rapid development of the service industry; the leasing and business services industry maintained a two digit growth rate, increasing by 2.5 percentage points over the same period last year; the growth rate of pportation, storage and post industry, the financial sector and the real estate industry increased faster than last month.

First of all, the growth rate of infrastructure investment will be stabilized at around 5%. Affected by the consolidation of the financial sector and the intensification of financial supervision, the main financing channels for infrastructure investment have been greatly affected. Coupled with the high base of last year, the growth rate of infrastructure investment has dropped sharply since the beginning of this year, which has become a major factor that has dragged down the overall investment growth.

However, historical data show that the peak period of local debt issuance is from May to August. As of the end of May, local debt issuance is less than 1 trillion yuan. According to the annual plan, 2 trillion and 200 billion yuan will be issued in the second half of this year.

High frequency data also show that the scale of issuance in June has begun to increase.

With the gradual increase in the scale of the supply of local debt, and the central bank will reduce the reserve requirement by 0.5 percentage points from July 5th, it will release some liquidity and the pressure on the sources of capital construction will be eased.

The slowdown in infrastructure investment growth will be eased to a certain extent. It is estimated that investment growth will remain at around 5% in the second half of this year.

Second, the growth rate of investment in real estate development will drop to around 7%. In the first 5 months, the growth rate of real estate development investment is 10.2%, while the land acquisition area of real estate development enterprises is 77 million 420 thousand square meters, representing an increase of only 2.1% over the same period.

This means that in the investment of developers, the cost of land purchase has increased significantly.

This view can be verified from the data of the pfer of the right to use state-owned land.

From January to May, the income of the pfer of state-owned land use rights was 22251 billion yuan, an increase of 45.9% over the same period, which means that the price of state-owned land is increasing.

If the land acquisition fee in real estate development investment is excluded, the remaining part of real estate development investment growth rate is -1.5%.

Under the environment of tight credit, developers are faced with the pressure of increasing financing and decreasing capital turnover. The source of funds increased 5.1% from January to May, only half of the same period last year, and domestic loans, foreign capital and other capital sources all showed negative growth.

Therefore, it is estimated that the growth rate of real estate investment will tend to fall in the second half of this year, and the growth rate will drop to around 8%.

Again, manufacturing investment has risen to around 7%. Since the beginning of this year, manufacturing investment has been rising steadily, mainly due to the rapid growth of private investment.

In the structural deleveraging environment, private investment in the second half is expected to maintain a relatively fast growth.

At the same time, the profits of the former enterprises are better. In addition, under the pressure of Sino US trade friction, the channels of absorbing and digesting and reabsorbing the hi-tech industries in our country are blocked. The investment of the enterprises in independent innovation or will make efforts, and the investment in the high-tech manufacturing industry will become an important force for stimulating the overall investment growth of the manufacturing industry.

It is estimated that manufacturing investment will continue to maintain a steady recovery, and the growth rate will rise to around 7% in the second half of this year.

Slowdown in consumption growth is expected to ease

Consumption growth was the most worrying thing from January to May. Especially in May, the growth rate of consumption fell 0.9 percentage points from last month, and is different from that of investment growth, which is mainly affected by the sharp decline in infrastructure investment. Consumption growth shows a decline in the whole category except petroleum products, communications equipment and household appliances.

It is expected that the downward trend of consumption growth in the second half of this year will be eased, and the overall trend will be stable, with a growth rate of around 9.3%.

There are four reasons.

Consumer goods in May

The short-term fluctuations in growth rate are mainly affected by the Dragon Boat Festival holiday (the Dragon Boat Festival holiday in May last year) and the adjustment of the tax policy of relatively high automobile commodities.

According to the data released by the National Bureau of statistics, if the two short-term disturbance factors are excluded, the consumption growth rate in May will be higher than that in April.

In the first quarter of 2018, the nominal per capita disposable income of the national population increased by 8.8%, which was 0.3 percentage points faster than the same period of the previous year.

The unemployment rate in May was 4.8%, down three consecutive months.

The steady growth of residents' income and employment will support consumption and not fall too fast.

With the steady growth of residents' income and the continuous increase of effective supply, consumption upgrading has maintained rapid growth, for example, communications equipment and cosmetics have maintained a relatively rapid growth of over 10%, and the growth rate is accelerating.

In addition, real estate

To a certain extent, the boom will lead to the growth of consumption of furniture, decoration and household appliances.

The Ministry of Commerce announced that a tariff of 25% would be imposed on some US imports since July 6th. This will inhibit the consumption of some of these commodities to some extent, but the substitution effect will also increase the consumption of other similar commodities.

Prices remained stable overall.

In the second half of the year, the CPI center will move upward.

First, data show that pork prices have rebounded in May.

With the improvement of supply and demand pattern, the price of pork is expected to be further repaired in the second half of the year.

Secondly, the survey data released by the central bank showed that residents' willingness to travel consumption increased significantly in recent years, and more residents may choose to travel before and after the Spring Festival, which magnifies the fluctuation of tourism prices before and after the Spring Festival.

Therefore, tourism prices may become an important disturbing factor for CPI data before and after the holidays.

Overall, the CPI center may be higher than the first half of the year * in the second half of this year, due to the rise in pork prices and crude oil prices.

In the second half of this year, the growth rate of PPI will drop.

From historical data, crude oil and steel prices are the most important factors that affect China's PPI index.

Under the combined effect of higher oil price and higher steel price, PPI in January and May came out of the "V" shape reversal from January to May.

First of all, from the perspective of steel supply and demand, the supply and demand pattern of steel in 2018 has improved significantly compared with 2017. It is estimated that the fall in demand in the fourth quarter of 2018 will bring downward pressure on steel prices.

Secondly, judging from the trend of crude oil prices, there is still a certain gap between supply and demand in crude oil in the second half of the year, and crude oil price is estimated to fluctuate.

On the whole, crude oil prices still have upward space in the second half of the year, but steel prices may fall back, overlaying the impact of higher base prices. PPI is expected to fall somewhat in the second half of the year.

Sino US trade friction has limited influence.

Recently, Sino US trade friction continues to heat up.

By constructing the dynamic CGE model, we preliminarily estimated the economic impact under various tax scenarios.

First, if the United States impose a 25% tariff on US $50 billion export commodities, it will have a negative impact on China's economic growth in 2018, 2019 and 2020 respectively. The impact of the scheme on the macro-economy is relatively limited, and it will decrease year by year with the passage of time in the 25% years.

Two, if the United States, on the basis of the original US $50 billion, levy a 10% tariff on our exports of $200 billion, it will have a negative impact on China's economic growth in 2019 and 2020, respectively, 0.262 and 0.235 percentage points.

Since the above plan is still in the initial stage of the US concept, it will not be implemented until the end of 2018, so this article does not examine the overall impact of the scheme on China's macro-economy in 2018.

Three, if the United States, on the basis of the above 250 billion dollars, levy a 10% tariff on our exports of $200 billion, it will have a negative impact on China's economic growth in 2019 and 2020, respectively, 0.431 and 0.393 percentage points.