Group 1: Economic Outlook - In October, limited consumption is expected to rebound, with a projected growth rate of around 5% for limited goods consumption, up from 3.77% in September[2] - The average growth rate for limited goods consumption (excluding catering) is forecasted to be 2.7% in 2023, 3.55% in 2024, and 4.24% in the first three quarters of 2025[3] - The contribution of limited goods consumption (excluding catering) to total retail sales is significant, accounting for 52.2% in 2024[3] Group 2: Price Trends - CPI is expected to show a slight year-on-year decline of around -0.1% in October, with a month-on-month change of approximately 0%[4] - PPI is projected to decrease by -0.2% month-on-month and slightly worsen to -2.4% year-on-year in October[4] Group 3: Production and Trade - Industrial production growth is anticipated to slow to about 5.5% in October[5] - Export growth is expected to decline to around 3.5% year-on-year in October, while imports are projected to grow by 1%[5][13] Group 4: Investment and Real Estate - Fixed asset investment growth is forecasted to drop to -0.8% for the period from January to October, with real estate investment down by -14.5%[5][17] - Real estate sales area growth is expected to be around -15% in October, with major developers experiencing a 41.9% year-on-year decrease in sales[5][18] Group 5: Financial Indicators - New social financing is expected to reach 1.1 trillion yuan in October, a decrease of 200 billion yuan compared to the previous year[6][24] - M2 growth is projected to be around 8.4% year-on-year, while new M1 is expected to be approximately 6%[6][24]

Group 1: National Day Consumption - Travel remains resilient, but growth rate slows compared to the May Day holiday, with a 5.3% year-on-year increase in cross-regional personnel flow during the first five days of the holiday, down from 7.9% during the May Day holiday [2][4] - The growth rate for long-distance travel by rail and civil aviation is low, both below 4%, while waterway and outbound travel show higher growth rates, with waterway passenger transport up 8.7% and international flights up 11.7% [4][17] - Retail sales growth is low at 3.3% year-on-year, indicating potential pressure on October's retail sales, with significant growth in home appliances and green food consumption [5][20][22] - Food prices remain stable, while service prices show mixed trends, with airfares rising by 9.2% and hotel prices varying significantly between first-tier and third/fourth-tier cities [6][24][25] - The film box office is down 19.2% year-on-year, potentially due to scheduling issues, despite some popular films performing well in previous months [7][27] Group 2: Weekly Economic Observation - The Huachuang macroeconomic WEI index has declined to 6.65%, down 2.12 percentage points from the previous week, but remains at a high level [29] - Durable goods consumption shows a decline in passenger car retail, with a year-on-year decrease of 2% reported [10][34] - Subway passenger transport growth has turned negative, with a 9.5% year-on-year decline reported in early October [11][34] - Oil prices have dropped significantly, with WTI crude oil at $61.69 per barrel, down 6.1% [12][52] - The new policy financial tool of 500 billion yuan is being actively promoted to support project capital [54][55]

Economic Growth - The GDP growth rate for Q3 is expected to be around 4.8%, with a cumulative growth rate of approximately 5.1% for the first three quarters[3] - The manufacturing investment growth rate from January to September is projected to be 4.0%, which is the first time since 2021 that it may fall below the GDP growth rate[1] Price Trends - The Consumer Price Index (CPI) is expected to show a month-on-month increase of about 0.2% and a year-on-year decrease of around -0.2% in September[11] - The Producer Price Index (PPI) is anticipated to decline by approximately -0.2% month-on-month, with a year-on-year improvement from -2.9% to -2.5%[12] Investment and Consumption - Fixed asset investment growth is expected to drop to -0.2% for the first nine months, with real estate investment declining by 13.2%[18] - Retail sales growth is projected to be around 3.2% in September, influenced by high base effects from durable goods[21] Policy Adjustments - Recent policy adjustments include changes to real estate purchase restrictions in major cities and the introduction of new policy financial tools totaling 500 billion yuan to support project capital[2][5] - The government aims to enhance economic monitoring and timely policy adjustments based on economic conditions[1]

Core Insights - The article discusses the implementation of China's fiscal policy through the issuance of long-term special bonds to support the "old-for-new" policy, which aims to stimulate consumption and upgrade consumer goods [1][6] Special Bonds and Fund Allocation - In 2025, the government plans to issue 1.3 trillion yuan in special long-term bonds, with 300 billion yuan specifically allocated for the "old-for-new" policy [2] - The Ministry of Finance has been distributing funds in batches since the beginning of the year, with a total of 2.3 trillion yuan allocated by the end of Q3, ensuring support for peak consumption periods like "Double 11" and "Double 12" [2] Policy Implementation Status - The rapid consumption of national subsidy funds in the first half of the year led to a surge in the "old-for-new" policy, although some regions faced funding shortages and temporary suspensions [3] - Local governments have implemented measures such as scheduled, limited, and lottery-based distribution to manage fund allocation effectively [3] Structural Effects and Consumption Boost - The scope and standards of the "old-for-new" policy have expanded, now covering 12 categories of household appliances and including digital products like smartphones and tablets [4] - From January to May, retail sales growth was maintained at 5.0%, significantly higher than the same period last year, indicating the rapid and effective transmission of policy stimuli [4] Marginal Effects and Future Outlook - Since June, retail sales growth has slowed due to rapid fund consumption and high base effects from the previous year, with growth rates dropping to 4.8%, 3.7%, and 3.4% from June to August [5] - Despite the diminishing marginal effects of subsidies, retail sales are expected to maintain moderate growth in the second half of the year, supported by the final batch of funds and the year-end consumption peak [5] Summary - The "old-for-new" policy in 2025 has achieved its goals of "funds in place, effects visible, and structural optimization," effectively stimulating durable goods consumption and promoting a shift towards greener and smarter consumption [6] - The sustainability of consumption recovery in the long term will depend on improvements in household income and consumer confidence, indicating that while the subsidy policy provides temporary support, a transition to genuine consumption growth requires stable income and employment [6]

Core Viewpoint - The economic outlook for August indicates resilience under the easing of external demand pressures and the gradual withdrawal of extraordinary internal policies, with highlights in exports, production, and service consumption, while manufacturing investment, infrastructure investment, and durable goods consumption may continue to weaken due to policy rhythms [2][4]. Exports - It is expected that August dollar-denominated exports will grow by approximately 7% year-on-year, while imports will increase by around 2%. Key observations include a significant year-on-year increase of 9% in port container throughput and a manufacturing PMI average of 50.88% among major economies [4][14][15]. Production - The industrial growth rate for August is projected to be around 6.0%. High-energy-consuming industries are expected to remain stable, with a recovery in crude steel production growth. However, downstream consumption production may be relatively weak, as indicated by a PMI of 49.2% in the consumer goods sector [5][13]. Service Consumption - August is expected to see improved resident travel conditions, with increases in the business activity index and new orders in the railway and aviation sectors, likely boosting dining, accommodation, and entertainment consumption [5][21]. Social Financing and Investment - New social financing in August is anticipated to reach 2.1 trillion, an increase of 780 billion compared to the same period last year. The stock growth rate of social financing is expected to decline to around 8.7% [6][22]. - Fixed asset investment growth is projected to fall to around 1.0%, with manufacturing investment at 5.3% and real estate investment at -12.5% [6][18]. Price Levels - The Consumer Price Index (CPI) is expected to decline to around -0.5% year-on-year, while the Producer Price Index (PPI) is projected to recover from -3.6% to approximately -2.9% year-on-year [7][11][12]. Durable Goods Consumption - The "old-for-new" policy is being reintroduced with refined subsidy arrangements, but durable goods consumption growth may slow. Retail sales growth is expected to be around 3.8%, with automotive sales declining by 3.5% [6][20]. Real Estate Sales - Real estate sales area growth is expected to be around -8.0%, with significant declines in sales figures for major property companies [19]. Financial Sector - The government bond issuance and corporate bond issuance in August are projected to be around 1.2 trillion, with a decrease in net financing for government bonds and corporate bonds compared to the previous year [22][24].

Consumption - The contribution of trade-in programs to retail sales has weakened, with July retail sales growth declining by 1.1 percentage points to 3.7% year-on-year[3] - The personal consumption loan interest subsidy is expected to boost retail sales by approximately 0.2 percentage points, with a historical context showing a 1% subsidy could lead to a greater impact than previous years[4] - The consumer loan consumption rate has remained low, averaging around 2.5% since 2024, indicating a shift towards cash purchases rather than credit expansion[3] Production - Industrial production growth in July was 5.7%, down 1.1 percentage points from the previous value, with a month-on-month increase of only 0.38%[5] - Service sector production also saw a slight decline of 0.2 percentage points to 5.8% year-on-year, with mixed performance across various industries[5] Fixed Investment - Real estate investment has further declined, with July showing a year-on-year drop of 12.0%, and new housing sales showing signs of weakness[6] - Manufacturing investment has decreased by 1.3 percentage points to 6.2%, with significant declines in sectors such as non-ferrous metallurgy and chemical products[6] - Infrastructure investment turned negative for the first time since 2021, with broad infrastructure showing a decline of 1.9% year-on-year in July[6] Economic Outlook - The data from July indicates a further weakening of domestic demand, suggesting increased downward pressure on economic growth in Q4, which may prompt policy adjustments[7] - Risks include potential underperformance of policy measures and unexpected downturns in the U.S. economy[7]

1. Report Industry Investment Rating No relevant content provided. 2. Core Views of the Report 2.1 Stock Index Strategy - A-share broad-based indices had positive weekly gains, with the Science and Technology Innovation 50 having the largest cumulative increase of 4.63% and the CSI 500 rising over 3%. The US and the EU reached a trade agreement, and the US June durable goods orders had a sharp decline. China's June industrial enterprise profits showed a narrowing decline, and the CSRC aimed to consolidate the market. Considering the market sentiment cooling and high technical indicators, the stock index's slow bull trend remains unchanged, but there may be a near-term correction, so a defensive wait-and-see approach is advisable [12]. 2.2 Treasury Bond Strategy - In the bond market, funds are flowing out, and with macro events concentrated at the end of July and early August, the bond market may experience an adjustment in a volatile pattern. Whether to participate on the left side or wait for the release of position pressure depends on the investor's position, duration, and tolerance. It is recommended to focus on taking profits [13]. 2.3 PMI - In June, the manufacturing PMI rose to 49.7%, better than expected, with both supply and demand improving. However, there were structural differences, such as small enterprises' contraction intensifying and the high-tech manufacturing industry remaining flat. Only 7 out of 15 sub - industries had better sentiment than in May [20]. 2.4 Inflation - In May 2025, the CPI had a slight year - on - year decline, and the PPI also decreased year - on - year. The current price situation shows "food differentiation and services stronger than goods," and the core inflation momentum is still insufficient. The decline in PPI is affected by international and domestic factors, but there are also positive changes in some areas [29][32]. 2.5 Industrial Enterprise Profitability - In May, the year - on - year growth rate of profits of industrial enterprises above designated size declined, mainly due to the decline in volume, price, and profit margin, with the profit margin having the most significant impact. Enterprises may adopt a strategy of reducing prices to clear inventory [35]. 2.6 Fiscal Situation - From January to May, the national general public budget revenue decreased slightly year - on - year, while the expenditure increased. The tax revenue recovery margin slowed down, and the real - estate - related tax drag increased. The fiscal expenditure rhythm slowed down marginally, and the government fund revenue decline widened while the expenditure slowed down [38][41]. 2.7 Industrial Added Value - In May, the year - on - year growth rate of industrial added value declined, while the service industry added value increased. The production - sales imbalance persists, and export - related production is weak. The GDP growth rate in the second quarter is expected to exceed 5% [44]. 2.8 Fixed - Asset Investment - From January to May, the year - on - year growth rate of fixed - asset investment declined. Investment in infrastructure, manufacturing, and real estate all decreased. Although the real - estate physical volume was not weak this month, the real - estate investment was still under pressure in terms of funds [47]. 2.9 Social Retail Sales - In May, the year - on - year growth rate of social retail sales increased, mainly driven by the early start of the 618 promotion and the strong performance of the May Day holiday in driving offline consumption [50]. 2.10 Social Financing - In May, the new social financing was 2.3 trillion yuan, with government bonds being the main support. Although the social financing growth rate is expected to rise in the second and third quarters, there is still pressure for it to rise and then fall in the second half of the year [53]. 2.11 Import and Export - In May, China's exports and imports continued to grow, with exports performing well. The central region led the national foreign trade growth. Due to the Sino - US trade relationship and the leading growth rate of processing trade, exports are expected to maintain resilient growth in June [59]. 2.12 US Non - Farm Payrolls - In May 2025, the US labor market showed resilience, with more new jobs than expected. However, there were internal structural differences. The service industry had employment growth, while the commodity production sector was weak. The wage growth exceeded expectations, strengthening inflation concerns and giving the Fed more reason to stay on the sidelines [62][65]. 2.13 US CPI - In May, the US CPI and core CPI increased year - on - year as expected. The inflation pressure on core commodities and services was controllable. The Fed maintained the interest rate target range and emphasized high uncertainty, so it tended to stay on the sidelines [68]. 2.14 US PMI - In June, the US Markit manufacturing PMI was stable at 52, and the service industry PMI was slightly lower. The manufacturing growth was mainly driven by inventory, and the inflation pressure increased significantly. The current US economy shows a "weak expansion + high inflation" characteristic, and the growth momentum may further weaken [71]. 3. Summaries According to the Catalog 3.1 Financial Futures Strategy Recommendations 3.1.1 Stock Index Strategy - **Strategy Outlook**: Adopt a defensive wait - and - see approach [11]. - **Trend Review**: A - share broad - based indices had positive weekly gains [12]. - **Technical Analysis**: The RSI indicator shows a potential correction risk for the market index [12]. 3.1.2 Treasury Bond Strategy - **Strategy Outlook**: Focus on taking profits [13]. - **Trend Review**: The bond market was volatile, and the treasury bond futures showed a downward trend [13]. - **Technical Analysis**: The KDJ indicator shows that the T main contract may operate weakly in a volatile manner [13]. 3.2 Key Data Tracking 3.2.1 PMI - In June, the manufacturing PMI rose, with both supply and demand improving. However, there were structural differences among different enterprise sizes, industries, and sub - industries [20]. - The price and inventory situation also showed different characteristics at the industry level, with some industries replenishing inventory and others reducing inventory through price cuts [23]. - The non - manufacturing PMI rose, mainly due to the increase in the construction industry PMI, while the service industry PMI declined [26]. 3.2.2 Inflation - In May 2025, the CPI had a slight year - on - year decline, with food price differentiation and service prices being more resilient. The PPI decreased year - on - year, mainly affected by international and domestic factors, but there were positive changes in some areas [29][32]. 3.2.3 Profitability of Industrial Enterprises above Designated Size - In May, the year - on - year growth rate of profits declined, mainly due to the decline in volume, price, and profit margin. Enterprises may be adopting a strategy of reducing prices to clear inventory [35]. 3.2.4 Fiscal - From January to May, the national general public budget revenue decreased slightly year - on - year, and the expenditure increased. The tax revenue recovery margin slowed down, and the real - estate - related tax drag increased. The fiscal expenditure rhythm slowed down marginally, and the government fund revenue decline widened while the expenditure slowed down [38][41]. 3.2.5 Industrial Added Value - In May, the year - on - year growth rate of industrial added value declined, while the service industry added value increased. The production - sales imbalance persisted, and export - related production was weak [44]. 3.2.6 Fixed - Asset Investment - From January to May, the year - on - year growth rate of fixed - asset investment declined. Investment in infrastructure, manufacturing, and real estate all decreased. Although the real - estate physical volume was not weak this month, the real - estate investment was still under pressure in terms of funds [47]. 3.2.7 Social Retail Sales - In May, the year - on - year growth rate of social retail sales increased, mainly driven by the early start of the 618 promotion and the strong performance of the May Day holiday in driving offline consumption [50]. 3.2.8 Social Financing - In May, the new social financing was 2.3 trillion yuan, with government bonds being the main support. The social financing growth rate is expected to rise in the second and third quarters but may face pressure to rise and then fall in the second half of the year [53]. 3.2.9 Import and Export - In May, China's exports and imports continued to grow, with exports performing well. The central region led the national foreign trade growth. Exports are expected to maintain resilient growth in June [59]. 3.2.10 US Non - Farm Payrolls - In May 2025, the US labor market showed resilience, with more new jobs than expected. There were internal structural differences, and wage growth exceeded expectations, strengthening inflation concerns [62][65]. 3.2.11 US CPI - In May, the US CPI and core CPI increased year - on - year as expected. The inflation pressure on core commodities and services was controllable, and the Fed tended to stay on the sidelines [68]. 3.2.12 US PMI - In June, the US Markit manufacturing PMI was stable at 52, and the service industry PMI was slightly lower. The manufacturing growth was mainly driven by inventory, and the inflation pressure increased significantly [71]. 3.2.13 Weekly Focus - There are important economic indicators and events to be released in the coming week, including the US GDP, FOMC interest rate decision, and China's official and Caixin manufacturing PMIs [73].

Group 1 - The A-share market showed positive performance on July 18, with the Consumer ETF (159928) rising nearly 1% and achieving a trading volume exceeding 260 million yuan, marking a net inflow of over 85 million yuan over the past four days [1][3] - The Consumer ETF (159928) has a total scale exceeding 12.2 billion yuan, leading its peers significantly [1] - Key stocks within the Consumer ETF saw gains, including Luzhou Laojiao and Xin Nuo Wei rising over 3%, Shanxi Fenjiu over 2%, and Guizhou Moutai and Muyuan Foods over 1% [3] Group 2 - The external environment for the food delivery market is evolving, with a significant increase in competition among major players, leading to a surge in daily orders [8] - The online food delivery market has expanded rapidly, with online dining accounting for nearly 25% of total dining consumption, while dining revenue constitutes about 11.2% of total retail sales [5] - The impact of delivery subsidies is expected to drive a substantial increase in overall dining revenue, with projections indicating a 48.6% year-on-year growth in food delivery revenue for July [11]

Retail Sales Comparison - China's retail sales absolute value reached approximately 80% of the United States between 2021 and 2024 [1] - According to World Bank data, China's retail sales, in terms of actual purchasing power, exceeded the United States by 1.6 times [1]

Core Viewpoint - The actual GDP growth for Q2 2025 is 5.2%, showing recovery from the previous year's lower growth rates, while nominal GDP growth remains a concern at 3.9% [1][7][9]. Economic Structure and Growth Drivers - The actual growth is supported by broad-based increases in various sectors: manufacturing investment grew by 17.3%, durable goods consumption saw a 30.7% increase in retail sales of major appliances, and service consumption rose by 5.3% [1][9]. - Exports also contributed positively, with a year-on-year increase of 5.9% in the first half of the year [1][9]. Industrial Capacity Utilization - The industrial capacity utilization rate for Q2 is 74.0%, slightly down from 74.1% in Q1 and 76.2% in the previous year, indicating a slowdown but with a deceleration in the rate of decline [2][10]. - Specific sectors like coal, food and beverage, chemicals, and automotive are experiencing lower utilization rates, while electrical machinery shows signs of improvement [2][10]. June Economic Indicators - In June, industrial value-added growth reached 6.8%, the highest in three months, driven by factors such as tariff adjustments and increased production in emerging sectors like industrial robots and integrated circuits [3][13]. - Retail sales growth in June fell to 4.8%, the lowest in four months, with significant declines in sectors like dining and beverages, while automotive sales showed resilience with a 4.6% increase [4][14]. Investment Trends - Fixed asset investment growth slowed to 2.8% year-on-year, with manufacturing investment particularly affected, possibly due to high prior usage of equipment renewal funds [5][15]. - Real estate sales and investment continued to decelerate, indicating a need for new policies to stabilize the market after a period of demand release [5][16][17]. Summary of Economic Performance - The first half of the year saw an actual growth of 5.3%, laying a solid foundation for achieving around 5% growth for the year [6][19]. - Key concerns include nominal GDP, industrial capacity utilization, and the ongoing decline in retail and real estate sectors, highlighting the need for effective policy signals to support investment and consumption [6][19].