Group 1: Macroeconomic and Monetary Policy Stance - The policy tone has shifted to a "neutral dovish" stance compared to the July FOMC meeting, indicating a fragile balance in the labor market with rising risks of job losses [3][9][11] - Economic growth is slowing, with a real GDP growth rate of 1.2% in the first half of 2025, which is half of the 2024 rate, primarily due to a slowdown in consumer spending [10][11] - Inflation is influenced by tariffs, which are clearly visible but may be "one-time" effects, necessitating close monitoring of their transmission and accumulation [3][17][18] Group 2: Long-term Monetary Policy Framework Normalization - The long-term monetary policy framework has been revised to return to a 2% inflation target and a broad maximum employment goal, moving away from the average inflation targeting introduced in 2020 [4][22][25] - The 2025 statement serves as a retrospective confirmation of the Fed's monetary policy strategy, emphasizing the need to balance inflation and employment amid the current "stagflation" challenges [4][25][78] Group 3: Expectations and Risks of Fed Rate Cuts - The expectation for a rate cut in September has increased significantly, with implied probabilities rising from 72% to 94%, and the number of expected cuts for the year increasing from 1.9 to 2.2 [5][31][42] - The key to whether the September rate cut materializes lies not in Powell's statements but in the upcoming non-farm payroll report and inflation data [5][42][43] - The macroeconomic scenario for 2026 suggests persistent inflation and economic stabilization, but the pricing of three rate cuts may be overly optimistic, warranting caution regarding long-term bond yields and the dollar's reversal risk [5][53][60]

Core Viewpoints - The article discusses the potential sustainability of China's export growth, suggesting that the contribution of "export grabbing" in the first half of the year may be overestimated, with non-US demand recovery and emerging market share gains being crucial for future growth [9][29]. Group 1: In-depth Topics - The article explores whether exports will continue to exceed expectations, highlighting that the recent surge in exports may not be sustainable due to the impact of tariffs and trade policies [9]. - It also addresses the political crisis surrounding the Federal Reserve and the reassessment of US debt risks, indicating that these factors could influence global financial markets [11]. Group 2: Hot Topics - The macro monthly report notes a new trend in overseas capital behavior, with a shift back towards US markets driven by the second-quarter earnings season [15]. - The article emphasizes the need to monitor which markets are worth focusing on for future investment opportunities [9]. Group 3: High-Frequency Tracking - The article mentions a series of conference calls, including discussions on liquidity and the implications of the Jackson Hole meeting, which are relevant for understanding market dynamics [33][38]. - It highlights the importance of analyzing fiscal data, noting a slowdown in debt funding support and an acceleration in spending related to people's livelihoods and the service sector [23].

Core Viewpoint - The research process is iterative and requires continuous denial and reconstruction to approach the truth, emphasizing the importance of diligent and practical research in the investment banking sector [22]. Group 1 - The year 2025 is marked as a year of comprehensive upgrade for the research team, focusing on restructuring the research framework and systematically displaying research results [22]. - The new development phase of the economy is characterized by a shift in policy focus towards "people-centered" strategies, emphasizing long-term strategies for expanding domestic demand rather than short-term stimuli [25]. - The "new three drivers" of the economy, including service consumption, service industry investment, and service exports, have shown significant acceleration, indicating an approaching transformation opportunity [24]. Group 2 - The "anti-involution" movement is seen as a new phase of supply-side structural reform, with increased government and industry attention, broader coverage, and stronger coordination between policies and market mechanisms [26]. - The global macroeconomic landscape is expected to experience significant changes, particularly with the "American exceptionalism" narrative being challenged, leading to a rebalancing of global funds [29]. - Geopolitical risks have become a crucial factor in global macroeconomics and asset pricing since the Russia-Ukraine conflict, with ongoing developments in geopolitical tensions influencing market narratives [32].

Core Viewpoint - The article discusses the fiscal revenue and expenditure situation in China for the first seven months of 2025, highlighting a slowdown in fiscal expenditure growth while expenditures related to people's livelihoods and the service industry are accelerating [2][3][69]. Group 1: Fiscal Revenue and Expenditure Overview - From January to July 2025, the national general public budget revenue reached 135,839 billion yuan, a year-on-year increase of 0.1%, while expenditure was 160,737 billion yuan, up 3.4% year-on-year [2][8]. - In July 2025, the broad fiscal revenue grew by 3.6% year-on-year, an increase of 0.8 percentage points compared to June, while broad fiscal expenditure rose by 12.1%, a decrease of 5.5 percentage points from June [3][9][70]. - The completion rate of the broad fiscal revenue budget for the first seven months was 56.3%, in line with the average level of the past five years, while the expenditure completion rate was 51%, slightly below the average of 51.7% [3][9][70]. Group 2: Changes in Fiscal Support - The slowdown in broad fiscal expenditure growth may be partly due to the end of the large-scale support phase from government debt financing [3][14][70]. - By July 2025, the broad fiscal revenue and expenditure gap reached -5.6 trillion yuan, with only a 0.4 trillion yuan increase from June, indicating a potential reduction in government debt support [3][14][70]. - The National Development and Reform Commission announced that the 1,880 billion yuan investment subsidy for equipment updates supported by ultra-long-term special bonds had been fully allocated, suggesting a decrease in government debt funding for fiscal expenditures [3][14][70]. Group 3: Sector-Specific Expenditure Trends - Despite the overall decline in broad fiscal expenditure growth, expenditures related to people's livelihoods and the service industry have significantly accelerated [4][20][71]. - In July 2025, the growth rates for health and social employment expenditures were 14.2% and 13.1%, respectively, both showing substantial increases from June [4][20][71]. - Expenditures in cultural tourism, media, and education also saw growth rates of 7% and 4.6%, respectively, with increases of 3.8 and 2.2 percentage points from June [4][20][71]. Group 4: Revenue Composition and Trends - The broad fiscal revenue continued to show improvement, with a year-on-year increase of 3.6% in July 2025, driven by a 2.6% increase in general fiscal revenue and an 8.9% increase in government fund revenue [5][27][72]. - The completion rate of the broad fiscal revenue budget in July was 8.5%, higher than 7.8% in 2024 but slightly below the five-year average of 8.9% [5][27][72]. - The decline in land transfer income has contributed to the slowdown in government fund revenue growth, which was 8.9% year-on-year in July, down 11.9 percentage points from June [33][38][72].

Group 1 - The core issue behind the current "political crisis" surrounding the Federal Reserve is whether it can "manipulate" interest rates and the implications of a steepening U.S. Treasury yield curve [3][4] - Market expectations for the next "shadow Fed chair" candidates are led by Chris Waller (26.6%), Kevin Hassett (13.7%), and Kevin Warsh (7.9%), all of whom are perceived as having dovish monetary policy stances [10][16] - The Federal Reserve's ability to "set" but not "manipulate" policy rates is emphasized, with long-term interest rates being more influenced by macroeconomic factors than short-term rates [5][47] Group 2 - The transition from "loose fiscal + loose monetary" to "tight fiscal + loose monetary" is suggested as necessary for sustainable fiscal reform, with a historical correlation indicating that a 1% reduction in the fiscal deficit could lower 10-year Treasury yields by 12-35 basis points [7][9] - The U.S. government's fiscal and debt situation is described as being in a "quasi-war state," necessitating fiscal consolidation to manage rising deficits and leverage ratios [9][19] - The Federal Reserve's long-term ability to influence the yield curve is limited, with market pricing often being overly dovish during rate hike cycles and overly hawkish during rate cut cycles [6][41]

Group 1 - The core viewpoint of the article is that China's export growth is primarily driven by exports to emerging economies, particularly in production materials, while exports to non-US developed economies are mainly in consumer goods [2][3][4] - In the first half of 2025, China's overall export increased by 5.9% year-on-year, with emerging economies contributing 4.7 percentage points to this growth [9][134] - The export performance to emerging economies is particularly strong in intermediate goods, which increased by 2.4 percentage points, while consumer goods negatively impacted the overall growth by 3.7 percentage points [21][135] Group 2 - The article discusses that the strong export performance may be partially attributed to "export grabbing," with estimates suggesting that 30% of the growth could be due to this phenomenon, while 70% is driven by external demand and market share changes [4][68] - The US's import surge, which appears to reflect "import grabbing," is primarily driven by specific goods from the EU and Switzerland, rather than a general increase across all categories [35][40] - China's exports to non-US markets have increased significantly, but this is not solely due to "transshipment" as the data shows a mismatch in export performance between China and ASEAN countries [46][62] Group 3 - Future export growth may continue to exceed expectations, as the US's import demand has not yet reached a balance point, indicating potential for further increases [76][81] - Short-term impacts on exports to emerging economies may arise from tariff implementations, but medium-term prospects remain positive due to rising investment demand and urbanization in these regions [90][94] - The expansion of the middle class in emerging markets is driving consumption upgrades, presenting new opportunities for high-value exports from China [120][124]

Group 1 - The core viewpoint of the article is that the U.S. economy showed resilience in July, leading to a reversal in the global capital "rebalancing" trend, with funds flowing back to the U.S. [2][8] - In July, the U.S. economy was characterized by inflation pressures exceeding stagnation, with a slight increase in the unemployment rate to 4.2% and a notable GDP rebound of 3.5 percentage points to 3.0% in Q2 [3][9] - The S&P 500 companies reported earnings and revenues that exceeded market expectations, which boosted market sentiment and attracted foreign capital back to U.S. assets, with foreign investments in U.S. stocks and bonds increasing by $11.36 billion and $11.34 billion respectively [3][18] Group 2 - In July, the "anti-involution" policies in China were positively received, with multiple measures being implemented to combat low-price competition and promote the exit of outdated production capacity [4][40] - The "anti-involution" policies led to a significant recovery in upstream prices, alleviating cost pressures and improving profit margins, with the PMI for major raw material purchasing prices rising by 3.1 percentage points to 51.5% [51] - However, the demand side showed weakness, with external demand performing better than internal demand, as exports to the U.S. fell by 5.6 percentage points to -21.6% [61] Group 3 - In August, the focus will be on the labor market trends in the U.S. and the continuation of "anti-involution" policies in China [5][73] - The U.S. labor market is expected to show signs of weakness, with the unemployment rate likely to remain elevated due to a shrinking number of job seekers and an expanding labor force [5][73] - In China, attention will be on the marginal changes in internal demand and the effectiveness of "anti-involution" measures, particularly in the context of rising upstream prices and their impact on downstream enterprises [5][73]

Group 1 - The article discusses the better-than-expected performance of the US economy in July, which, along with stronger-than-expected Q2 earnings, led to a reversal in the global capital "rebalancing" trend, with funds flowing back to the US [2] - Developed market indices saw an overall increase, with the Nikkei 225 rising by 3.7% and the S&P 500 increasing by 0.9% [4][5] - The article highlights the significant rebound in glass prices, which increased by 13.9% [50] Group 2 - The article notes that the US core CPI for July was weaker than expected, with a month-on-month increase of 0.3%, aligning with market expectations, but the performance of goods related to tariffs was notably weak [70][74] - The article mentions that the market's expectation for a rate cut by the Federal Reserve in September has increased, driven by the weaker-than-expected CPI data [70] Group 3 - The article reports that the US 10-year Treasury yield rose by 6.0 basis points to 4.3%, while yields in other developed countries also saw increases [22] - Emerging market 10-year Treasury yields showed mixed results, with Turkey's yield rising by 205.5 basis points to 31.2% [27] Group 4 - The article indicates that the US dollar index fell by 0.4% to 97.85, while the offshore RMB appreciated to 7.1891 against the dollar [33][43] - It also notes that commodity prices mostly declined, with WTI crude oil dropping by 1.7% to $62.8 per barrel [48]

Economic Situation Analysis - The external environment is becoming increasingly complex and severe, with the need to maintain strategic determination and focus on domestic issues to achieve significant breakthroughs in modernization tasks [3][8]. - The report indicates that the Chinese economy still faces numerous risks and challenges, contrasting with the previous report's more optimistic tone [3][24]. - Despite challenges, the report emphasizes the stability, advantages, resilience, and potential of the Chinese economy, asserting that the long-term positive trend remains unchanged [3][8]. Policy Orientation - The report advocates for the implementation of a moderately loose monetary policy, emphasizing the importance of policy execution and effectiveness [4][9]. - It reiterates the need for continuity and stability in policies while enhancing flexibility and foresight, aiming to create a conducive financial environment [4][25]. - The report highlights the importance of balancing support for the real economy with maintaining the health of the banking system, aiming to lower bank funding costs and facilitate a decrease in loan interest rates [4][25]. Key Issues - The report focuses on enhancing financial support for the real economy, particularly for small and micro enterprises and technology-driven SMEs, indicating a shift in credit structure towards these areas [5][26]. - It notes a significant transformation in the structure of new loans, with the proportion of loans directed towards real estate and infrastructure dropping from over 60% in 2016 to approximately 70% now being allocated to the "five major articles" of finance [5][26]. - The report stresses the need to improve the supply of high-quality services to boost consumption, identifying issues such as insufficient supply, quality concerns, and low profitability of enterprises in the service sector [5][27].

Group 1 - The article discusses the upcoming expiration of the tariff suspension measures between China and the U.S. on August 12, and the potential for easing trade risks based on recent trade agreements with Japan and the EU [7] - It highlights the ongoing economic situation in July, characterized by strong supply but weak demand, indicating a mixed economic outlook [11] - The article notes that the Producer Price Index (PPI) has shown weakness due to low capacity utilization in mid and downstream sectors, which are considered two underlying factors affecting PPI performance [12] Group 2 - The financial data for July indicates a significant rebound in M2 year-on-year, primarily driven by an active capital market [15] - The article mentions that the U.S. has established a three-tiered tariff system as part of its trade agreements, with significant uncertainties regarding the execution of investment and procurement commitments [17][18] - It emphasizes the long-term and targeted nature of tariff leverage, with secondary and transshipment tariffs gradually taking shape [18]