Report Industry Investment Rating There is no information provided in the report regarding the industry investment rating. Core Viewpoints of the Report - The economic data in the first half of 2025 showed a "mixed" pattern. Exports remained resilient, the growth rate of social retail sales increased significantly, but there were "hidden concerns" behind the growth. The decline in real estate investment continued to widen, and it will take time for prices to stabilize [4]. - The intensity of "rush exports" is expected to weaken in the second half of the year. The sales and production of the household appliance industry may cool down, which will affect social retail sales and industrial added value. The decline in real estate investment will continue to expand, and it is necessary to pay attention to the incremental support for urban renewal funds and the introduction of a financing system compatible with the new real - estate development model. It will take time for prices to stabilize [4][5]. Summary According to the Catalog 1. What are the new changes in exports? - **Tariff situation**: The average tariff rate of the United States on China is around 40%, an increase of 29 percentage points compared to before Trump took office. The exemption of some commodities in April 2025 accounted for 24% of China's exports to the United States in 2024 [10]. - **Export data**: In May 2025, China's exports in US dollars increased by 4.8% year - on - year, and imports decreased by 3.4%. In RMB, exports increased by 6.3% year - on - year, and imports decreased by 2.1%. Exports to the US and India decreased significantly, while exports to the UK and the EU increased significantly. The export of labor - intensive goods mostly had negative growth, but the export of clothing and toys rebounded [13]. - **Export delivery value**: The year - on - year decline in export delivery value was obvious. The new export order index moved down from the previous central level, and the kinetic energy of new export orders weakened [18][22]. 2. What policy expectations are there? Consumption policy - **Policy introduction**: In the past year, many consumption - promoting policies have been introduced, indicating that there is potential in the consumption market. However, China's consumption rate is low, and there are also structural problems in consumption [26]. - **Reasons for low consumption rate**: The main factors determining the household consumption rate are consumption ability and marginal consumption propensity. China's income structure shows obvious differentiation, and the imperfect social security system makes residents have a strong preventive savings motivation [33][38]. - **Policy measures**: The "Boosting Consumption Special Action" addresses the problems of consumption ability and consumption tendency by increasing income and reducing burdens. The "Guiding Opinions on Financial Support for Boosting and Expanding Consumption" further expands the scope of financial support for consumption, and the focus of consumption policies may shift to the service consumption field in the future [44][49][52]. Real - estate policy - **City renewal action**: The Politburo meeting in April proposed to intensify the implementation of the urban renewal action, which helps the real - estate investment to stabilize. The key point of follow - up attention is whether there will be incremental support for urban renewal funds [53]. - **Real - estate sales model**: The transition to the spot - sale model means the end of the high - turnover model of real - estate enterprises. The supporting policies, especially the financing policy, are not clear, which affects the funds of real - estate enterprises. It is necessary to pay attention to the introduction of a financing system compatible with the new real - estate development model [5][63]. Infrastructure policy - **Investment situation**: From January to May 2025, infrastructure investment increased by 5.6% year - on - year. If the scale of land reserve special bonds continues to increase this year, the special bond funds invested in traditional infrastructure fields may be less than in 2024 [64]. - **Structural differentiation**: In the context of debt resolution, infrastructure construction with the central government as the construction and expenditure subject may be stronger, while that with local governments as the subject may be weaker. The investment structure differentiation may continue [66]. - **Development space**: Railway investment still has room for development, and canal construction is in full swing. It is estimated that the overall growth rate of infrastructure in 2025 will be around 7.0% [66][70][73]. 3. Can prices stabilize and rebound? - **Price influencing factors**: The impact of currency on prices depends on the supply - demand relationship. Increasing the money supply may lead to an imbalance between supply and demand and make it difficult for prices to rise. The key to boosting prices is to expand effective demand and smooth the supply - demand cycle [76]. - **Policy measures**: The central bank will implement a moderately loose monetary policy, maintain sufficient liquidity, and create a good monetary and financial environment for the reasonable recovery of prices [76]. - **PPI situation**: The tail - wagging factor in the first half of the year continued to drag down the performance of PPI, and it will take time for prices to recover [80].