Group 1: Inflation and Policy Response - The core focus of July's policy is on "anti-involution," with multiple departments addressing the phenomenon of market "involution" [2][11] - The expected inflation rates for July are projected at -3.1% for PPI and 0% for CPI, indicating weak price performance despite rising commodity prices [2][11] - The increase in commodity prices is driven by expectations of supply contraction, but excess supply in downstream sectors limits the transmission of price increases from upstream to downstream [2][24] Group 2: Supply Dynamics - Industrial production remains resilient, with July's industrial value added expected to be around 6.4%, despite a decline in new orders [4][61] - The PMI production index indicates that production is still expanding, with notable increases in sectors like general equipment and black metal rolling [4][55] - The supply situation is characterized by a divergence, where production is better than demand, contrary to market expectations of significant supply contraction [4][48] Group 3: Demand Structure - Demand is showing signs of differentiation, with weak goods demand but stronger service demand, leading to a projected slight decline in actual GDP to 4.9% for July [6][73] - Export performance is expected to exceed expectations in July due to the residual effects of "export grabbing," but there are concerns about a potential decline in exports in September [6][73] - The consumer market is experiencing a potential decline in goods consumption due to a "subsidy gap" in the "old-for-new" program, while service consumption is expected to improve due to increased travel activity [8][89] Group 4: Investment Trends - Investment performance is mixed, with real estate and manufacturing investments likely to decline, while infrastructure and service sector investments may see improvement [8][102] - The acceleration of special bond issuance is expected to support infrastructure investment, with asphalt construction rates showing an upward trend [8][102] - The manufacturing sector faces downward pressure due to the nearing end of equipment renewal demand, while real estate investment is likely to continue weakening [8][102] Group 5: Economic Outlook - The main logic of economic operation in July revolves around "price increases," but the sustainability of these increases is relatively weak due to supply-side production increases and weak demand [9][112] - The overall economic indicators suggest a nominal GDP growth of 3.9% and an actual GDP growth of 4.9% for July, reflecting the current economic conditions [9][112]

Group 1 - The average tariff rate in the US increased to 18.3% after August 1, down approximately 4 percentage points from 22.5% on April 2 [62][63] - The new tariff rates for countries with trade agreements range from 10% to 20%, while those for countries with trade deficits range from 25% to 41% [62][63] - Ongoing negotiations between the US and other countries, including India, aim to finalize a phase one agreement by fall 2025, focusing on agricultural products, medical devices, and digital trade tariffs [62] Group 2 - Developed market indices experienced declines, with the S&P 500 down 2.4% and the French CAC40 down 3.7% [2][3] - Emerging market indices also saw declines, with the South Korean Composite Index down 2.4% and the Ho Chi Minh Index down 2.3% [3] - The majority of sectors within the S&P 500 fell, with materials, consumer discretionary, healthcare, and financials down 5.4%, 4.5%, 3.9%, and 3.8% respectively [6] Group 3 - The yield on the 10-year US Treasury bond decreased by 17.0 basis points to 4.2% [16] - The yield on 10-year bonds in other developed markets also fell, with Germany at 2.8% and Japan at 1.6% [16] - Emerging market 10-year bond yields mostly declined, with Turkey down 21.0 basis points to 29.3% and South Africa down 24.0 basis points to 9.6% [22] Group 4 - The US dollar index rose by 1.0% to 98.69, while most other currencies depreciated against the dollar [27] - The offshore Chinese yuan depreciated to 7.1929 against the dollar [39] - Major emerging market currencies also saw depreciation, with the Mexican peso down 1.6% and the Philippine peso down 1.0% [27] Group 5 - Commodity prices showed mixed results, with WTI crude oil rising 3.3% to $67.3 per barrel, while coking coal prices fell 13.2% to 1093 yuan per ton [45] - Precious metals experienced varied performance, with COMEX gold up 0.9% to $3360.1 per ounce, while COMEX silver fell 3.4% to $36.8 per ounce [52]

Group 1 - The core issue of the article revolves around the weaker-than-expected U.S. employment data for July, primarily due to significant downward revisions in May and June employment figures [2][4] - The July non-farm payrolls added only 73,000 jobs, below the market expectation of 104,000, while May and June figures were revised down by 125,000 and 133,000 respectively [5][11] - The downward revisions were mainly concentrated in the government sector, indicating that the previously reported strong employment figures were misleading [5][9] Group 2 - The article questions the reasons behind the substantial downward revisions in May and June, suggesting that statistical factors cannot fully explain the changes, and the primary reason is a weakening labor market [2][23] - Historical data shows that significant downward revisions in non-farm payrolls often correlate with economic downturns, suggesting a potential economic slowdown [40][48] - The labor market is entering a "loosened" phase, with both supply and demand weakening, making it difficult for the unemployment rate to decrease significantly [48][60] Group 3 - The economic outlook for the second half of the year indicates a continuation of the slowdown trend, with factors such as increased tariffs and reduced consumer spending likely to suppress economic growth [3][60] - Following the release of the July non-farm data, the market has priced in an 80% probability of a 25 basis point rate cut by the Federal Reserve in September [3][60] - The article emphasizes that the Federal Reserve's focus may shift towards the unemployment rate rather than non-farm payroll numbers, which could influence future monetary policy decisions [3][60] Group 4 - The article highlights that the labor market's current state reflects a mismatch between supply and demand, exacerbated by immigration policies that have reduced labor supply [64][66] - The equilibrium level of job growth needed to maintain a stable unemployment rate has decreased, indicating a potential shift in labor market dynamics [64][66] - The article suggests that while immigration policy changes may alleviate some upward pressure on unemployment, they may not fully counteract the weakening demand in the labor market [64][66]

Core Viewpoint - The article discusses various economic trends and policies in China, focusing on fiscal spending, child-rearing subsidies, and the implications of the "involution" phenomenon in different sectors [6][12][21]. Group 1: Currency and Economic Policies - The article highlights the weak yen amidst political turmoil, analyzing the reasons behind its depreciation and potential future developments [9]. - It emphasizes the need for a balanced supply-demand relationship in industries to address the "involution" issue, suggesting that local governments play a crucial role in this process [12][21]. Group 2: Fiscal Spending and Child-Rearing Subsidies - Fiscal spending has accelerated significantly in the first half of the year, raising questions about whether this high growth rate can be sustained in the latter half [17]. - The introduction of child-rearing subsidies is expected to have systemic impacts on employment, education, and healthcare, with various regions implementing different subsidy policies [19][20]. Group 3: Industrial Performance and Economic Outlook - The industrial profit data for June indicates improvements in costs and revenues, supporting a recovery in profits, although the "involution" trend may limit further declines in profits [21]. - The July Central Political Bureau meeting emphasized the importance of service consumption and enhancing industrial competitiveness, marking a shift towards "high-quality" investments [23]. Group 4: Market Trends and International Relations - The article notes that the PMI data for July reflects a paradox where anti-involution policies have led to price increases, yet supply-demand dynamics and industry changes appear counterintuitive [25]. - Recent agreements on tariffs between the US and Japan have resulted in positive market reactions in developed markets, indicating a potential for increased trade cooperation [28]. Group 5: Domestic Economic Activity - Despite a relatively weak industrial production environment, port cargo volumes remain strong, suggesting resilience in certain sectors [29]. - The article also tracks domestic policy developments, including the public consultation on the price law amendment, which reflects ongoing regulatory adjustments [31].

Group 1 - The core viewpoint emphasizes the importance of high-quality construction of the Yarlung Tsangpo River downstream hydropower project, which is described as a century project requiring advanced technology and ecological protection [2][3] - The government is focusing on optimizing agricultural production and ensuring the employment of migrant workers and those who have escaped poverty, highlighting the importance of data-driven monitoring and support measures [3] - The establishment of the Housing Rental Regulations aims to fill legal gaps in the housing rental industry, emphasizing the need for accurate information and regulatory compliance among rental agencies and enterprises [4][5] Group 2 - The draft amendment to the Price Law seeks to clarify standards for unfair pricing behaviors, including low-price dumping and price collusion, to regulate market order and prevent "involution" competition [6] - The National Development and Reform Commission is taking steps to address "involution" competition by promoting cooperation between state-owned and private enterprises, enhancing industrial chain collaboration, and fostering technological innovation [7][8] - The Ministry of Industry and Information Technology is working to standardize competition in the new energy vehicle industry, focusing on product safety, quality, and fair market practices [9][10] Group 3 - The Market Supervision Administration is addressing "involution" competition in the quality sector by strengthening market access management and enhancing quality safety supervision [11][12] - The new tax policies for Hainan Free Trade Port aim to reduce production costs for local enterprises and stimulate market activity by exempting certain goods from import taxes [13][14] - The focus on local government behavior in the context of "involution" highlights the need for regulatory measures to prevent excessive competition and ensure sustainable economic growth [18][19][20]

Group 1 - The current "anti-involution" differs from previous instances by focusing more on regulating local government behavior, emphasizing the need for a unified government action standard [2][11][90] - The shift from "Five Unifications and One Abolition" to "Five Unifications and One Opening" highlights the importance of local government behavior regulation and external openness [11][12][90] - The current round of "involution" is driven by local governments' deep involvement, characterized by creating policy gaps, blindly launching projects, and setting market barriers [2][16][90] Group 2 - Local governments are facing pressure to find growth drivers due to the downturn in the real estate cycle, with national commodity housing sales area down 39.7% and real estate investment down 27.3% from 2021 to 2024 [4][29][92] - The reliance on land finance has decreased, leading local governments to seek growth in high-tax industries, with manufacturing and wholesale retail accounting for 32% and 14% of total tax revenue in 2021 [4][37][92] - The principle of "production-based taxation" in the VAT system encourages local governments to promote manufacturing clusters [42][92] Group 3 - The average investment growth rate in manufacturing exceeded 10% in 16 provinces from 2022 to 2023, with the top five provinces averaging over 20% [52][53][92] - There is a significant overlap in industrial planning among local governments, particularly in sectors like pharmaceuticals, new materials, artificial intelligence, and new energy, leading to repeated construction and overcapacity [57][94] - Local governments are competing through tax incentives and subsidies, resulting in significant differences in manufacturing tax burdens across provinces, with a national average of 17.4% in 2023 [70][94] Group 4 - The central government is likely to implement targeted reforms to address local government "involution," including regulating investment attraction behaviors and promoting a healthy investment environment [79][94] - Short-term measures may include cleaning up illegal policy incentives, while long-term strategies could involve changing government functions and promoting efficient resource allocation nationwide [79][94]

Core Viewpoints - The "anti-involution" policy has boosted prices, but supply and demand performance appears counterintuitive [3][8] - The manufacturing PMI decreased by 0.4 percentage points to 49.3%, exceeding the average decline since 2017 [3][8] - The increase in commodity prices is reflected in the raw material purchase price index (+3.1 percentage points to 51.5%) and the factory price index (+2.1 percentage points to 48.3%) [3][8] Manufacturing Sector - The manufacturing PMI has marginally declined, with production and new order indices both decreasing [5][34] - The production index fell by 0.5 percentage points to 50.5%, while the new order index dropped by 0.8 percentage points to 49.4% [5][34] - The new export order index decreased by 0.6 percentage points to 47.1%, indicating a slowdown in market demand [5][38] Non-Manufacturing Sector - The non-manufacturing PMI fell by 0.4 percentage points to 50.1%, primarily due to a significant decline in the construction PMI [45] - The construction PMI decreased by 2.2 percentage points to 50.6%, with the new order index dropping sharply by 2.2 percentage points to 42.7% [6][61] - The service sector PMI showed a slight decline, with the new order index remaining weak at 46.3% [49] Key Industries - High-energy-consuming industries have shown production strength despite price increases, with the steel industry PMI rising by 4.6 percentage points [4][21] - The equipment manufacturing and consumer goods industries experienced declines in PMI, falling by 1.1 and 0.9 percentage points to 50.3% and 49.5%, respectively [4][21] - Investment demand has weakened significantly, contrasting with the strong production performance in high-energy-consuming sectors [24][72] Future Outlook - The political bureau meeting in July emphasized the need for further implementation of the "anti-involution" policy, particularly focusing on the downstream effects and marginal changes in domestic demand [30][72] - The current situation indicates that the "anti-involution" policy in the upstream sectors still requires further advancement [30][72]

Core Viewpoint - The article discusses the outcomes of the July Central Political Bureau meeting, emphasizing the importance of maintaining policy continuity and stability while enhancing flexibility and foresight in response to economic conditions. The meeting sets the stage for the upcoming 20th Central Committee's Fourth Plenary Session, focusing on the "14th Five-Year Plan" and the need for high-quality economic development and structural reforms [2][3][4]. Economic Performance and Policy Direction - The meeting highlighted the strong performance of the economy in the first half of the year, with a GDP growth rate of 5.3%, surpassing the annual target. This performance was achieved despite external challenges, showcasing the resilience of the Chinese economy [2][3][4]. - The meeting removed the phrase "external shocks are increasing" from its risk assessment but emphasized the need for vigilance and bottom-line thinking regarding potential challenges ahead [2][3][4]. Macro Policy Adjustments - The meeting called for sustained and timely macro policy efforts, particularly focusing on major economic provinces to drive national growth. It stressed the need to accelerate the implementation of existing policies and enhance their effectiveness [4][17]. - Fiscal policy will continue to prioritize the rapid issuance and utilization of government bonds, with a noted progress of 50.6% in new special bond issuance as of July 13, which is lower than the same period in previous years, indicating potential for further policy support [4][17]. - The monetary policy discussion did not mention interest rate cuts but introduced measures to lower overall financing costs, indicating a shift towards improving the transmission of monetary policy [4][17]. Focus on Key Areas - The meeting emphasized the importance of service consumption and the cultivation of industrial competitiveness, linking consumption policies with social welfare initiatives to enhance consumer demand [5][18]. - It reiterated the need to combat "involution" in the economy, focusing on orderly competition among enterprises and the governance of capacity in key industries, while promoting the development of internationally competitive emerging industries [5][18][19]. Investment Quality and Risk Management - There is a heightened focus on "high-quality" investments and a strict prohibition on the creation of new hidden debts, reflecting a commitment to risk prevention in key sectors [7][19]. - The meeting underscored the importance of high-quality urban renewal and the effective promotion of major construction projects while managing the risks associated with local financing platforms [7][19].

Group 1 - The core issue of "involution" is the imbalance between manufacturing and service industries, with manufacturing employment exceeding actual demand while service employment remains insufficient [2][9] - In 2023, manufacturing employment was significantly above potential levels (+0.2 million), while service employment showed a shortfall of -0.4 million compared to potential levels, indicating a recovery lag in the service sector [2][9] - Manufacturing investment remains high despite declining revenues, reflecting an "involution" phenomenon, while service investment is notably below demand, with a potential investment gap of approximately 1.5 trillion [2][18] Group 2 - Consumer demand shows a significant gap, with a shortfall of about 6.4 billion in goods consumption and nearly 30 billion in service consumption, indicating a stronger recovery need in the service sector [3][27] - The average gap in per capita service consumption is 2,093 yuan, while the total potential gap in national service consumption is close to 30 billion [3][27] Group 3 - Long-term solutions to "involution" involve shifting focus from manufacturing supply to service supply, as global experiences suggest a transition in consumer demand from goods to services at certain GDP and urbanization levels [4][35] - The aging population and smaller household sizes are expected to further enhance demand for service consumption, particularly in areas like healthcare and leisure [45][52] Group 4 - Current policies are actively promoting service consumption, investment, and exports, marking a shift in the economic growth model from manufacturing to services [6][80] - Policies encouraging increased consumer time, such as extended holidays and new school breaks, are expected to boost service demand [6][80] - Service investment is seeing improvements due to policy support and relaxed regulations on private investment, with significant growth in sectors like education and entertainment [6][91]

关注、加星，第一时间接收推送！ 文 | 赵伟、屠强 联系人| 屠强 耿佩璇 摘要 高频跟踪：工业生产表现分化，基建开工有所回暖，港口货运量仍在上行。 【工业生产】工业生产表现分化。 本周，高炉开工率同比小幅回升，录得1.2%。化工链生产有所回落， 纯碱、PTA开工同比分别-3.3pct至-6.0%、-1.2pct至-1.0%。汽车半钢胎开工仍不及去年同期，同比-0.2pct 至-3.3%。 【建筑业开工】建筑业开工表现分化。 本周，全国粉磨开工率同比-3.9pct至-6.2%；水泥出货率仍在低 位，同比-2.6pct至-3.0%。沥青开工率有所回升，同比+1.0pct至0.3%。 【下游需求】地产成交有所回升，港口货运量仍在上行。 本周，全国新房日均成交面积偏弱，同比 +20pct至-6.1%。货运方面，与出口相关的港口货物吞吐量、集装箱吞吐量回升，同比分别+5.2pct至 13.3%、+6.3pct至11.5% ；但集运价格延续回落、环比-3.2%。人流出行强度小幅回升，全国迁徙规模指 数同比+0.4pct至17.8%。国内执行航班架次同比+0.7pct至2.5%。 1. 生产高频跟踪：工业生产表现分化，基 ...