Core Viewpoint - The article discusses the substantial progress in the structural transformation of China's economy, highlighting the decline of the real estate sector's contribution to GDP and the rise of the "three new economies" [1][4]. Group 1: Economic Structure Transformation - The real estate sector's contribution to GDP is projected to drop to around 14% in 2024, below the 18% contribution of the "three new economies" [1][4]. - The "three new economies" had a value of 24.3 trillion yuan in 2024, representing 18.01% of GDP, up from 15.3% in 2016 [4]. Group 2: Real Estate Market Performance - Following the "924" policy, there was a concentrated release of real estate demand over two quarters, primarily from October 2024 to March 2025, with a subsequent adjustment expected from April 2025 [1][4]. - The sales area of commercial housing showed a year-on-year decline of 10%-23% from June 2023 to September 2024, with signs of improvement in late 2024 [5][6]. Group 3: Policy Measures - The Shanghai "Six Measures" introduced on August 25, 2024, included relaxing housing purchase restrictions, optimizing housing provident fund policies, and adjusting housing loan interest rates [2][8]. - The policies aim to stabilize the real estate market and are expected to be implemented in other cities, with potential expansions in housing finance policies [2][12]. Group 4: Impact on Macro Economy - The stabilization of the real estate market is expected to have indirect effects on the macro economy, including increased consumer spending and improved credit conditions for enterprises [3][13]. - The land transfer income accounted for 10.7% of local government revenue in the first seven months of the year, indicating the importance of real estate to local finances [3][13].

广发证券 资深宏观分析师 陈礼清 博士 chenliqing@ gf.com.cn 广发宏观郭磊团队 报告摘要 第一， 今年以来， 人民币汇率走势与国内资产走势维持着同步性。在7月份的报告《容易被忽视的本轮人民币升值》中，我们认为4月中旬以来人民币升值主要是 风险溢价的变化驱动，短期内的演绎需要观察中美贸易条件、逆周期政策、供求关系如何接续等线索。在这篇报告中，我们进一步构建了一套基于企业居民等微观 主体、外汇衍生品资金等来实时监测汇率预期的方法论体系，以期对汇率短期走势做到"看一步半走一步"。 第二， 先来介绍汇率预期因素与其他大类资产预期的独特性。一是反身性，学术研究发现汇率升贬预期具有自我实现性，存在汇率超调风险，因此政策层同样需要 保持关切；市场交易者（以索罗斯为代表）则强调外汇市场的连续反身系统，而普通权益的反身性只是短暂间歇存在。"投机性资本"在外汇与股票市场上的影响力 有显著差异，而投机性的资本看重"总回报率"又反过来容易受市场未来汇率预期驱动，最终短期可能出现"基本面"对汇率的影响链条被投机性资本扭曲的现象。二 是异质性。由于不同主体对于国内基本面存在不同理解、外汇信息传递过程中也可能存在时滞 ...

Group 1 - The article discusses the macroeconomic conditions under which high-growth narratives dominate the market, highlighting that these conditions typically arise after a certain level of macro risk has been released, and nominal growth rates remain low [1][2][3] - It identifies four key characteristics that support high-growth narratives: the release of macro risks, low nominal growth rates, sticky expected returns, and a favorable liquidity environment [2][3] - The article emphasizes the importance of technological and policy frameworks that create significant narrative space for certain industries, such as AI and semiconductors, which have been pivotal in recent market trends [3] Group 2 - The article notes that Chinese assets are outperforming globally, with domestic markets showing strong trends while overseas markets are experiencing mixed performance [4][5] - It highlights the divergence in asset performance, with U.S. stocks facing valuation resistance and commodities being influenced by supply-demand dynamics [4][5] - The article also discusses the implications of the U.S. Federal Reserve's interest rate expectations on the bond market, indicating a shift in market sentiment towards potential easing [6][7] Group 3 - The article provides insights into the performance of various asset classes, noting that the A-share market is showing signs of "convexity" with increasing trading volumes and a broadening market width [7][8] - It mentions that the 10-year government bond yield is rising, reflecting expectations of nominal GDP recovery, and discusses the relationship between equity valuations and nominal GDP growth [8][9] - The article outlines the performance of different sectors, with growth stocks leading the market while cyclical and financial sectors lag behind [9][10] Group 4 - The article discusses the impact of external factors on market sentiment, including the implications of recent comments from U.S. Federal Reserve officials and the political landscape affecting monetary policy [10][11] - It highlights a research report indicating that despite significant investments in generative AI, most companies have not seen substantial commercial returns, which may affect market sentiment [12][13] - The article also addresses the potential implications of new tariffs on various product categories, which could influence market dynamics and investor sentiment [14][15]

Core Viewpoint - The Jackson Hole Economic Policy Symposium serves as a significant platform for discussing global economic issues, influencing market expectations regarding U.S. monetary policy, particularly in terms of interest rate adjustments and inflation outlooks [1][6][19]. Group 1: Jackson Hole Economic Policy Symposium Insights - The symposium is hosted annually by the Kansas City Fed in Jackson Hole, Wyoming, and includes central bank governors, finance ministers, and academic and financial professionals [1][6]. - In the 2022 meeting, Fed Chair Powell adopted a hawkish stance, emphasizing the need for aggressive rate hikes to combat high inflation, which subsequently led to a faster pace of U.S. interest rate increases [1][6]. - The 2023 meeting saw Powell indicating a more cautious approach, stating that the Fed would proceed carefully, which resulted in a halt to further rate increases [1][6][7]. Group 2: Powell's 2025 Speech Highlights - In his 2025 speech, Powell expressed a dovish outlook, suggesting that changes in economic prospects and risk balances may necessitate adjustments in the Fed's policy stance [2][8]. - He noted that the impact of tariffs on inflation might be relatively short-lived, indicating a potential for inflationary pressures to stabilize [2][10]. - Powell highlighted that while the labor market appears balanced, it is characterized by a significant slowdown in both labor supply and demand, increasing the risk of layoffs and rising unemployment [2][11]. Group 3: FOMC Long-Term Goals and Monetary Policy Strategy - The FOMC released a new statement modifying its long-term goals, removing references to the "zero lower bound" and emphasizing the use of all policy tools to achieve dual objectives of maximum employment and price stability [3][12]. - The statement shifted from a flexible average inflation targeting strategy back to a simpler inflation targeting approach, indicating a return to traditional inflation management [3][12][13]. - The FOMC's focus has now shifted to promoting "maximum employment," allowing for more flexibility in policy adjustments without being constrained by perceived employment gaps [3][12][13]. Group 4: Market Reactions and Economic Indicators - The dovish tone from Powell increased the probability of a September rate cut, with market expectations reflecting an 84% chance of a rate reduction following the Jackson Hole meeting [5][19]. - Following the meeting, U.S. stock markets surged, with the Dow Jones rising by 1.89%, the S&P 500 by 1.52%, and the Nasdaq by 1.88%, indicating positive market sentiment towards potential rate cuts [5][19]. - Key economic indicators, such as employment data and inflation expectations, remain critical in shaping future monetary policy decisions, with the Fed closely monitoring these metrics [4][14][20].

Core Viewpoint - The EPMI (Emerging Industry Purchasing Managers Index) for August shows a slight month-on-month increase of 1.0 points, indicating a stabilization in economic activity despite remaining at a historically low level of 47.8, the lowest for August since 2014 [1][6][8]. Summary by Sections EPMI Overview - The EPMI increased by 1.0 points in August, aligning closely with the seasonal average increase of 1.1 points [7]. - The absolute index value of 47.8 is 1.0 points lower than the same month last year, marking the lowest level recorded for August since data collection began in 2014 [8][9]. Demand and Production Indicators - Demand indicators showed slight improvement, with product orders and export orders rising by 2.5 and 2.8 points respectively, while production indicators fell by 0.3 points [10]. - The production-to-order ratio turned negative at -0.6, indicating a better alignment between supply and demand [10]. - Supply contraction led to price increases, with purchase prices rising by 5.3 points and sales prices by 1.5 points [12]. - The difficulty of obtaining loans in emerging industries increased by 2.6 points, reflecting a tightening financing environment [12]. Sector Performance - The sectors of new energy and energy conservation are leading in terms of absolute economic performance, with significant price increases in the new energy vehicle, new energy, and biological industries [14]. - In August, new energy and energy conservation were the only two sectors in the expansion zone, likely influenced by accelerated fiscal funding and seasonal factors [14]. - Price increases in the new energy vehicle sector were notable, with sales prices rising by 4.6 points, indicating effective price management in larger enterprises [14][17]. High-Frequency Data Insights - High-frequency data from early to mid-August showed resilience in exports, production constraints, and strong pricing [18]. - Traditional industries experienced a decline in operating rates due to "anti-involution" effects, with specific declines noted in the automotive tire sector [18]. - Overall, manufacturing PMI is expected to show little change compared to July [18].

Core Viewpoint - The article discusses the recovery of tax revenue in July, highlighting a 4% year-on-year increase, while non-tax revenue continues to decline, indicating a reduced reliance on non-tax income by the government [1][5]. Revenue Analysis - In the first seven months, general public budget revenue increased by 0.1% year-on-year, meeting the initial budget target, with tax revenue showing a cumulative decline of 0.3%, leaving room for improvement towards the annual target of 3.7% [1][5]. - The four major tax categories performed strongly, with personal income tax rising by 13.9% year-on-year, significantly exceeding seasonal levels, attributed to factors such as a strong equity market and improved tax collection management [10][11]. - Corporate income tax showed a cumulative decline of 0.4% year-on-year, reflecting low corporate profitability amid low PPI levels, although July saw a monthly increase of 6.4% [10][11]. - Domestic consumption tax increased by 5.4% year-on-year, influenced by previous adjustments in consumption tax policies for automobiles [10][11]. - Stamp duty on securities transactions surged by 58% year-on-year in July, marking a significant increase [10][11]. Expenditure Analysis - In July, general public budget expenditure rose by 3.0% year-on-year, driven primarily by social security, health care, and debt servicing, while infrastructure spending declined by 3.6% [2][12]. - Cumulative expenditure from January to July increased by 3.4% year-on-year, slightly below the budget target of 4.4%, indicating a slower spending pace compared to the previous year [2][12]. - The increase in fiscal deposits is attributed to the front-loaded issuance of government bonds, which has allowed for smoother expenditure patterns and potential recovery in fiscal spending growth in the coming months [2][12]. Land Revenue and Market Trends - Land transfer revenue in July grew by 7.2% year-on-year, although cumulative growth for the year narrowed to -4.6% [3][18]. - High-frequency data indicates a 31.5% year-on-year decline in land transfer revenue for residential land in 300 cities in the first half of August, primarily influenced by first- and second-tier cities [3][18]. - The government is expected to implement strong measures to stabilize the real estate market, which may impact future fiscal policies and land revenue [3][18]. Infrastructure Investment Insights - Weak infrastructure investment in June and July is identified as a macroeconomic characteristic, potentially leading to looser narrow liquidity conditions [4][21]. - The government has emphasized the need to accelerate effective investment and the disbursement of new policy financial tools, which is likely to support construction activity in the latter half of the year [4][21].

Core Viewpoint - The article discusses the outcomes of the State Council's ninth plenary meeting held on August 18, emphasizing the need for targeted economic policies to stabilize and promote growth amid current challenges and uncertainties in the economy [4][5]. Economic Situation Analysis - The meeting highlighted the importance of understanding the economic situation comprehensively and dialectically, recognizing both the achievements and the challenges faced by the economy, particularly in light of the recent economic data indicating a weak domestic market [5][6]. - The July economic data showed a year-on-year decline in retail sales to 3.7% and a drop in fixed asset investment from 2.8% to 1.6%, indicating a need for policy intervention to stimulate consumption and investment [7][8]. Policy Focus Areas - The meeting identified "service consumption" and "effective investment" as the two main focuses of macroeconomic policy, aiming to address the current economic characteristics [7]. - There is a strong emphasis on cleaning up restrictive measures in the consumption sector and fostering new growth points in service consumption and new consumption models [7][8]. - The meeting also stressed the need for robust measures to stabilize the real estate market, which has shown signs of decline in various metrics such as sales and new construction [8][9]. Market Development Initiatives - The meeting underscored the importance of advancing the construction of a unified national market to release the benefits of a large-scale market, which includes measures to regulate competition and improve product quality [9][10]. - The focus on supply-side reforms and demand expansion is seen as crucial for improving nominal growth, which has been a significant issue in recent macroeconomic discussions [9][10]. Long-term Growth Strategies - The meeting addressed the integration of technological and industrial innovation, aiming to stimulate the vitality of business entities and expand high-level opening-up [10]. - These initiatives are expected to be key components of the upcoming 15th Five-Year Plan, with potential policy benefits anticipated in the near future [10].

Group 1 - The core viewpoint of the article discusses the driving factors behind the recent recovery in the equity market, emphasizing that attributing the market's rise to a single perspective is insufficient. It highlights the importance of economic fundamentals, liquidity, and risk appetite as contributing factors [1][2][3] - The article notes that from September last year to May this year, economic fundamentals were highly effective, with the recovery of profit expectations under a stable growth policy serving as the basis for market pricing recovery [2][3] - It identifies two periods of divergence between economic indicators and market performance: from Q2 to Q4 of 2021 and from June to August of this year, both characterized by ample liquidity but insufficient credit expansion due to local investment shortfalls [2][3] Group 2 - The article mentions that in the second week of August, the speed of asset rotation decreased, with a "risk on" sentiment dominating the stock and currency markets. The domestic ChiNext index led the gains, while global markets also showed positive trends [4][5] - It highlights that the rotation index for major assets has slowed down since mid-June, indicating a certain degree of persistence in strong assets and a return to a more focused trading approach [4][5] - The article discusses the performance of various asset classes, noting that the A-share market exhibited a pattern of rising prices, expanding volume, and low volatility, while the concentration of winning sectors increased [4][5][6] Group 3 - The article outlines the impact of U.S. economic data on market expectations, particularly the mixed signals from CPI and PPI, which influenced the fluctuations in U.S. Treasury yields and the dollar's performance [7][8] - It notes that the U.S. retail sales data showed resilience despite a slowdown compared to last year, with specific categories like furniture and clothing performing well [14] - The article also discusses the implications of the upcoming Jackson Hole global central bank meeting, where the Fed's stance on monetary policy will be closely watched [11][12][13] Group 4 - The article highlights the recent adjustments in China's monetary policy, emphasizing a focus on stabilizing prices and supporting credit flow to the real economy [19][20] - It mentions the seasonal contraction of narrow liquidity due to tax payment periods, with the central bank's report indicating a positive outlook for price levels [18][19] - The article discusses the increase in project funding and the improvement in the funding rate for construction projects, indicating a potential recovery in infrastructure investment [21] Group 5 - The article details a new policy in China providing a 1% interest subsidy for personal consumption loans, which is expected to stimulate consumer spending [22][23] - It estimates that this policy could boost retail sales by approximately 0.2-0.3 percentage points, reflecting the government's efforts to enhance consumer demand [22][23] - The article also discusses the recent trends in commodity prices, noting fluctuations in various sectors, including energy and industrial products [25][26]

Group 1: Industrial Sector Performance - The industrial sector's operating rates have shown mixed trends since August, with upstream operating rates remaining relatively high. As of the second week of August, the operating rate of 247 blast furnaces nationwide increased by 7.4 percentage points year-on-year, compared to a previous value of 1.2 percentage points [1][6][7] - The operating rates for coking enterprises and PVC also saw year-on-year increases of 5.7 percentage points and 5.5 percentage points, respectively [1][6][7] - Power generation growth slightly decreased to 3.2% year-on-year as of August 7, down from 3.9% in July [1][8] Group 2: Infrastructure and Construction - The physical workload in infrastructure remains low, with the national cement shipment rate recorded at 40.1%, a slight decrease of 0.04 percentage points month-on-month [2][10] - The funding availability rate for construction sites was 58.8%, with a month-on-month increase of 0.1 percentage points [2][10] Group 3: Consumer Activity - The average daily subway ridership in the top ten cities increased by 1.9% year-on-year to 62.73 million trips, indicating a stable rise in residents' living radius [2][11] - Domestic flights averaged 14,703 per day, up 2.0% year-on-year, while international flights saw a 12.3% increase [2][12] Group 4: Real Estate Market - Real estate sales have continued to weaken since April, with the average daily transaction area in 30 major cities dropping by 13.9% year-on-year in the first half of August [3][14] - The transaction area in first, second, and third-tier cities recorded year-on-year changes of -29.1%, -10.8%, and 2.4%, respectively [3][14] Group 5: Automotive Sector - Retail sales of passenger cars decreased by 4% year-on-year from August 1 to 10, while wholesale sales increased by 16% [3][17] - The retail sales of new energy vehicles grew by 6% year-on-year during the same period [3][17] Group 6: Shipping and Trade - Container throughput at domestic ports maintained a high growth rate of 7.3% year-on-year, while cargo throughput grew by 6.8% [4][19] - The number of container ships sent from China to the U.S. decreased by 11.9% year-on-year as of August 13 [4][19] Group 7: Price Trends - The Business Price Index (BPI) showed a slight recovery compared to the end of July, with the index recorded at 872 points, up 0.3% [4][22] - Prices for industrial products showed mixed trends, with coal and glass prices continuing to adjust downward [4][22][23]

Economic Overview - July economic data shows signs of slowdown, with only exports accelerating while industrial, service, consumption, investment, and real estate sales all underperformed compared to previous values, indicating a divergence in internal and external demand [1][6] - The actual GDP index estimated from industrial value added and service production index year-on-year is approximately 5.02%, while the estimate based on industrial value added and retail sales is about 4.79%, both lower than the second quarter [1][6] Industrial Performance - Industrial value added year-on-year growth is 5.7%, down from 6.8% previously, with a month-on-month seasonally adjusted increase of 0.38%, only higher than April's tariff impact [7][9] - Major product output shows significant declines in coal production growth, while new industry products like smartphones and robots also saw decreased growth rates; however, integrated circuits and power generation equipment remain at high growth levels [9][10] - The industrial enterprise sales rate increased to 97.1%, the second highest this year, indicating improved supply-demand relationships despite lower industrial supply [11] Consumer Spending - Retail sales year-on-year growth is 3.7%, down from 4.8%, with a month-on-month seasonally adjusted decline of 0.14% [12][13] - Key sectors dragging down retail performance include dining and tobacco, as well as automotive sales, which turned negative for the first time in five months, likely due to price competition constraints [12][13] - Growth in household appliances and mobile phones remains high, but cumulative growth has slowed compared to the first half of the year, influenced by the gradual release of demand and lower national subsidy fund balances [12][13] Investment Trends - Fixed asset investment cumulative year-on-year growth is 1.6%, down from 2.8%, with a month-on-month decline of 5.2% [13][14] - Manufacturing, infrastructure, and real estate investments all showed significant month-on-month declines, with manufacturing attributed to high equipment renewal funding released in the first half of the year [13][14] - Infrastructure investment's unexpected decline may be due to weather disturbances and the timing of new project approvals and financial tools, with local investment showing reduced activity [13][14] Real Estate Sector - The real estate sector continues to slow, with declines in sales, new starts, construction, investment, and funding availability [16][17] - The average price of new and second-hand homes in 70 cities showed slight month-on-month declines of 0.3% and 0.5%, respectively, indicating limited changes from trend values [16][17] - Recent policy adjustments in Beijing aim to stabilize the real estate market, suggesting that further policy support may be necessary to prevent continued declines [16][17] Overall Economic Sentiment - July's soft data, including PMI and BCI, along with credit and economic data, indicate a consistent trend of slowdown, aligning with the previously mentioned "deceleration zone" [5][18] - Ongoing macroeconomic policies are emerging, particularly focused on supporting service consumption, which is expected to gradually bolster consumer spending [5][18] - Local investment and real estate are identified as key sources of the overall data slowdown, with effective investment being a crucial part of terminal demand [5][18]