Core Viewpoint - The economic data for July indicates a slowdown in China's economy, with both supply and demand sides experiencing challenges, leading to a mixed outlook for various sectors [1][3]. Consumption - Retail sales growth in July was 3.7%, below the market expectation of 4.8%, influenced by extreme weather and other short-term factors [4][5]. - The growth rate of commodity consumption fell to 4%, with notable resilience in demand for essential goods like grain and oil (8.6%) and home appliances (28.7%) [4][5]. - Service retail sales growth slightly decreased to 5.2%, with cultural and tourism consumption supported by government subsidies [7][8]. Fixed Asset Investment - Fixed asset investment growth was 1.6%, down 1.2 percentage points from the previous month, with infrastructure investment at 7.3% and manufacturing investment at 6.2% [9][12]. - Real estate investment continued to decline, with a year-on-year drop of 12%, and sales volume and value of commercial housing also decreased significantly [12][14]. Import and Export - July saw better-than-expected performance in imports and exports, with export growth in dollar terms rising to 7.2%, driven by strong demand from non-US regions [18][19]. - Trade surplus expanded to $98.24 billion, a year-on-year increase of 14.9% [18][19]. Supply - Industrial production showed stable growth, with a year-on-year increase of 5.7%, supported by resilient exports and government policies [21][22]. - The service sector maintained a growth rate of 6.0%, although there are concerns about the sustainability of this growth [21][22]. Inflation - Price pressures remained, with CPI inflation at 0% and PPI inflation at -3.6%, influenced by seasonal factors and international trade uncertainties [23][24]. Outlook - The economic outlook suggests rising uncertainties in external demand and persistent internal demand issues, with recent policies aimed at boosting consumption and investment expected to take effect gradually [25].

Inflation Overview - July CPI year-on-year growth slightly exceeded consensus expectations, while PPI year-on-year growth fell below expectations[1] - July CPI increased by 0.4% month-on-month, remaining flat year-on-year, with core CPI rising by 0.8%[2] - Service prices rose by 0.5% year-on-year, while consumer goods prices fell by 0.4%[2] CPI Analysis - Year-on-year growth in July was driven by other goods and services (8.0%), clothing (1.7%), and healthcare (0.5%), while food and tobacco prices fell by 0.8%[2] - Food prices contributed to a 0.29 percentage point decline in CPI year-on-year, with gold and platinum jewelry prices adding 0.22 percentage points to CPI growth[2] - Service prices accounted for approximately 0.26 percentage points of the month-on-month CPI increase, representing over 60% of the total CPI rise[6] PPI Insights - July PPI decreased by 0.2% month-on-month and 3.6% year-on-year, with the decline in production materials contributing significantly[15] - The month-on-month decline in PPI was the first narrowing since March, influenced by seasonal factors and international trade uncertainties[16] - The overall PPI decline was impacted by eight industries, which collectively contributed approximately 0.24 percentage points to the PPI decrease[16] Future Outlook - The second half of the year is expected to see a narrowing of the PPI year-on-year decline due to improved supply-demand relationships in certain industries[20] - Seasonal and policy factors may cause fluctuations in various price segments, particularly in food and durable goods[7] - Risks include potential global inflation resurgence and rapid economic downturns in Europe and the U.S.[30]

Group 1: CPI Analysis - The Consumer Price Index (CPI) increased by 0.4% month-on-month in July, reversing a previous decline of 0.1%, with year-on-year growth remaining flat [1][2] - Core CPI, excluding food and energy, rose by 0.8% year-on-year, marking the highest increase since March 2024, with a continuous expansion in growth for three consecutive months [2][3] - The rise in CPI was primarily driven by service prices, which increased by 0.6% month-on-month, contributing approximately 0.26 percentage points to the overall CPI increase [2] Group 2: PPI Analysis - The Producer Price Index (PPI) decreased by 0.2% month-on-month, but the decline was less than the previous month, marking the first month-on-month narrowing of the decline since March [4][5] - Year-on-year, the PPI fell by 3.6%, with the decline remaining consistent with the previous month, indicating some stabilization in certain industries [4][5] - The decrease in PPI was influenced by seasonal factors and uncertainties in the international trade environment, affecting prices in several sectors, including construction materials and electronics [4][5] Group 3: Sector-Specific Price Changes - Prices in the manufacturing of traditional and emerging industries showed positive changes, with specific increases noted in sectors such as glass manufacturing and wearable smart devices [5][6] - Notable price increases were observed in the manufacturing of arts and crafts (up 13.1%), sports balls (up 5.3%), and nutritional foods (up 1.3%) [6]

Group 1: Policy Impact on Consumption - A series of consumption-boosting policies have been introduced in China, including measures to promote cultural and tourism consumption, which have injected strong momentum into the consumer market [1][4] - The "old-for-new" policy for consumer goods has significantly accelerated consumption potential, with air conditioning sales on Meituan increasing over tenfold year-on-year in June [1][2] - As of May 31, 2023, the "old-for-new" policy has driven sales of 1.1 trillion yuan across five major categories, with substantial subsidies provided to consumers [2] Group 2: Growth in Service Consumption - Service consumption has seen rapid development, with a 5.2% year-on-year increase in service retail sales from January to May, outpacing the growth of goods retail sales [3][4] - The government has initiated various programs to enhance service consumption, including the "Service Consumption Season" and the promotion of integrated consumption scenarios [4] Group 3: Future Outlook - The outlook for the second half of the year suggests continued growth in consumption, supported by increased policy measures and the release of service consumption potential [5] - Financial support for consumption is being strengthened, with a recent guideline from six departments outlining 19 key measures to enhance consumer capacity and expand financial supply [5]

Group 1: CPI and PPI Trends - In April, the Consumer Price Index (CPI) showed a month-on-month increase of 0.1%, while the year-on-year CPI decreased by 0.1%, maintaining the same decline as in March [1] - The Producer Price Index (PPI) decreased by 2.7% year-on-year, with the decline slightly widening compared to March, and a month-on-month decrease of 0.4% [1][2] - Energy prices fell by 4.8% year-on-year, with gasoline prices dropping by 10.4%, contributing approximately 0.38 percentage points to the CPI decline [1][2] Group 2: Food and Service Prices - Food prices saw a narrowing year-on-year decline, with a month-on-month increase of 0.2%, which is above seasonal levels; beef prices rose by 3.9% month-on-month due to reduced imports [2] - Travel service prices increased significantly, with airfares rising by 13.5%, vehicle rental fees by 7.3%, hotel accommodation by 4.5%, and tourism prices by 3.1% [2] - The core CPI, excluding food and energy, rose by 0.5% year-on-year, indicating the gradual effect of policies aimed at boosting domestic demand and consumption [2] Group 3: High-Tech Industry Impact - The development of high-tech industries, such as smart manufacturing and high-end equipment manufacturing, has led to price increases in related sectors, with wearable device manufacturing prices rising by 3.0% year-on-year [3] - The diversification of trade and market expansion has resulted in price increases or reduced declines in some export sectors, such as integrated circuit packaging and testing, which saw a 2.7% year-on-year price increase [3] - Recent financial support policies, including interest rate cuts, are expected to provide significant support for future price trends [3]

Group 1 - In May, the Consumer Price Index (CPI) decreased by 0.2% month-on-month and 0.1% year-on-year, while the Producer Price Index (PPI) fell by 0.4% month-on-month and 3.3% year-on-year, indicating the effectiveness of consumption-boosting policies [1][2] - Energy prices were the main factor dragging down both the CPI and PPI, with energy prices decreasing by 6.1% year-on-year and 1.7% month-on-month, contributing significantly to the overall decline in CPI [1] - The core CPI, excluding food and energy, increased by 0.6% year-on-year, with hotel accommodation and tourism prices rising by 4.6% and 0.8% respectively, indicating a recovery in consumer demand [1][2] Group 2 - The PPI data showed signs of marginal improvement in terminal consumer demand, with life goods prices stabilizing and certain manufacturing sectors experiencing reduced year-on-year price declines [2] - High-tech product demand is expanding, with prices in sectors such as integrated circuit packaging and testing, aircraft manufacturing, and wearable smart devices increasing by 3.6%, 3.0%, and 2.1% respectively [2] - Analysts predict a likely upward trend in the price level, with CPI expected to gradually recover and PPI showing signs of marginal improvement due to the impact of previous consumption-boosting policies [2]

Group 1 - The Consumer Price Index (CPI) decreased by 0.2% month-on-month and 0.1% year-on-year in May, while the Producer Price Index (PPI) fell by 0.4% month-on-month and 3.3% year-on-year, indicating a continued impact of consumption-boosting policies [1][2] - Energy prices were the main factor dragging down both the CPI and PPI, with energy prices decreasing by 6.1% year-on-year and 1.7% month-on-month, significantly affecting the overall CPI decline [1] - Core CPI, excluding food and energy, increased by 0.6% year-on-year, with hotel accommodation and tourism prices rising by 4.6% and 0.8% respectively, indicating a recovery in certain sectors [1] Group 2 - PPI data showed marginal improvement in terminal consumer demand, with life goods prices stabilizing and some manufacturing prices narrowing their year-on-year decline [2] - High-tech product demand is expanding, with prices in sectors like integrated circuit packaging and testing, aircraft manufacturing, and wearable smart devices increasing by 3.6%, 3.0%, and 2.1% respectively [2] - Economic analysts predict a likely upward trend in the price index, with CPI expected to gradually recover and PPI showing signs of marginal improvement due to previous consumption-boosting policies [2]

Economic Indicators - In March, China's CPI decreased by 0.4% month-on-month and 0.1% year-on-year, with a notable narrowing of the decline; PPI also fell by 0.4% month-on-month and 2.5% year-on-year, influenced by seasonal and international factors [1][6][7] - Core CPI showed a significant rebound, increasing by 0.5% year-on-year, indicating an improvement in supply-demand structure and some positive price changes [1][7] Commodity Market - Crude oil prices saw a slight increase, with the U.S. Energy Information Administration lowering global oil demand forecasts; concerns over economic growth due to Trump's tariff policies are rising [2][11] - Gold prices continued to strengthen as U.S. core CPI for March fell to 2.8%, the lowest since March 2021, below market expectations, while market uncertainty continues to drive demand for gold [3][19][20] Stock Market - U.S. stock markets experienced significant declines, while A-shares showed resilience against tariff pressures, supported by coordinated efforts from various financial authorities to stabilize the market [4][9] - The trading volume in the stock market reached 1.66 trillion yuan, with notable increases in various stock index futures [4][9] International News - The European Commission announced a 90-day suspension of retaliatory tariffs against the U.S., while preparations for further measures continue if negotiations do not yield satisfactory results [5] Domestic Policy - The Chinese Ministry of Commerce emphasized the commitment to high-level opening-up and support for foreign trade enterprises facing export challenges, including initiatives to boost domestic consumption [8] Financial Market - The bond market showed mixed results, with the yield on 10-year government bonds declining to 1.6475%; the central bank's operations indicated a tightening of liquidity [10] - The market anticipates potential monetary policy adjustments, including possible interest rate cuts, in response to domestic and international economic conditions [10] Agricultural Products - Malaysian palm oil production in March increased by 16.76% month-on-month, with exports rising slightly; however, the overall impact of U.S. tariff policies on agricultural products remains a concern [31][32] Shipping Index - The European shipping index saw a rebound due to improved market sentiment following Trump's tariff policy reversal, with contracts nearing limit-up levels [33]