Core Viewpoint - The key task for China's economic development is to optimize the fiscal expenditure structure, emphasizing investment in the livelihood sector rather than over-concentrating funds on housing and infrastructure [3][5]. Economic Growth - In the first three quarters of the year, China's GDP grew by 5.2% year-on-year, with quarterly growth rates of 5.4%, 5.2%, and 4.8% respectively [2]. Fiscal Policy - The current fiscal policy should gradually shift towards increasing the proportion of final consumption in GDP from approximately 55% to at least 65% [3]. - The adjustment in fiscal expenditure is expected to take three to five years to achieve sustainable economic development [3]. Livelihood Investment - There is a need for direct financial support to the public, such as issuing consumption vouchers, while ensuring that funds reach those in need [6]. - The relationship between improving livelihoods and economic development is crucial, as economic growth should fundamentally meet the real needs of the people [6]. Employment and Income - Measures should be taken to narrow the income gap and improve the income levels of low-income groups, with a focus on creating more job opportunities [7]. - Local governments should prioritize stabilizing and expanding employment based on their specific circumstances [10]. Social Security - There is a general issue of low social security levels and significant funding gaps across the country, necessitating increased fiscal investment in social security [13]. - The government should ensure strict compliance with social insurance contributions to enhance social security coverage [13]. Market Dynamics - The construction of a unified national market requires accurate understanding of market dynamics, including identifying surplus and shortage areas [14]. - The focus should be on combating unfair competition while protecting legitimate competition [14][15]. Corporate Support - Policy resources should be directed towards enterprises with market demand, particularly labor-intensive industries, to boost employment [15]. - Companies facing sales difficulties due to lack of innovation should be allowed to exit the market if they do not reform [16].

1. Report Industry Investment Rating - No information provided regarding the industry investment rating. 2. Core Viewpoints of the Report - Family - support - oriented fiscal policies are continuously introduced, optimizing the fiscal expenditure structure towards a "people - investment" and "people's livelihood - focused" direction, with potential long - term economic and social benefits [5][8][9]. - The Ministry of Finance has once again reported six typical cases of implicit debt accountability, highlighting the need to strengthen the investigation and accountability of implicit debt and improve the investment and financing mechanisms in key policy - supported areas [10][11][13]. - The process of key provinces "exiting the list" continues, with Inner Mongolia being the first to officially announce its exit, and efforts are needed to consolidate the results and prevent new implicit debts [14]. 3. Summary by Relevant Catalogs 3.1. Important News Reviews 3.1.1. Family - support - oriented Fiscal Policies - Since July, family - support - oriented policies such as the implementation plan for child - rearing subsidies and the gradual implementation of free preschool education have been successively introduced. These policies are expected to increase the proportion of people's livelihood expenditure in fiscal expenditure, optimize the central - local expenditure structure, and stimulate consumption and human capital development [5][8][9]. 3.1.2. Ministry of Finance's Report on Implicit Debt Accountability - On August 1, 2025, the Ministry of Finance reported six typical cases of implicit debt accountability, all involving new implicit debts. The new implicit debts occurred relatively recently and were concentrated in policy - supported areas such as urban renewal and high - standard farmland construction [10][11][13]. 3.1.3. Key Provinces "Exiting the List" - Inner Mongolia has officially announced its exit from the list of key provinces with local debt risks. However, it still faces challenges such as high debt ratios in some areas and large temporary fiscal payments, and efforts are needed to prevent new implicit debts [14]. 3.1.4. Early Redemption of Bonds by Urban Investment Enterprises - This week, 32 urban investment enterprises redeemed bond principal and interest in advance, involving 33 bonds with a total scale of 59.14 billion yuan. The enterprises are mainly from the central region, and the majority of the bond issuers have an AA rating [17]. 3.1.5. Cancellation of Bond Issuance - Two urban investment bonds were cancelled this week, with a planned total issuance scale of 17.5 billion yuan. As of August 4, 77 urban investment bonds have been postponed or cancelled this year, with a total scale of 442.26 billion yuan [18]. 3.2. Issuance of Local Government Bonds and Urban Investment Enterprise Bonds 3.2.1. Local Government Bonds - This week, the issuance scale and net financing of local government bonds decreased. The issuance progress of new special bonds exceeded 60%. The issuance interest rate and spread both increased. The weighted average issuance interest rate rose to 1.89%, and the weighted average issuance spread rose to 10.42BP [19]. 3.2.2. Urban Investment Bonds - The issuance scale of urban investment bonds decreased this week, while the net financing scale increased. The issuance interest rate increased, and the spread widened. The overall issuance interest rate was 2.33%, and the issuance spread was 78.73BP. Five overseas urban investment bonds were issued, with a total scale of 33.22 billion yuan [22][23]. 3.3. Trading of Local Government Bonds and Urban Investment Enterprise Bonds - The central bank conducted 1663.2 billion yuan in reverse repurchases this week, with 1656.3 billion yuan in reverse repurchases maturing, resulting in a net investment of 690 million yuan. Short - term capital interest rates generally declined [26]. - This week, the trading scale of local government bond cash bonds decreased by 7.14% to 380.769 billion yuan, and most of the maturity yields declined, with an average decline of 1.50BP. The trading scale of urban investment bonds increased by 2.69% to 277.6 billion yuan, and most of the maturity yields declined, with an average decline of 2.44BP [27]. - There were 16 abnormal transactions of 14 bonds from 14 urban investment entities this week. The number of entities decreased, but the number of bonds and abnormal transactions increased [28]. 3.4. Important Announcements of Urban Investment Enterprises - This week, 50 urban investment enterprises issued announcements regarding changes in senior management, legal representatives, directors, supervisors, etc., as well as changes in controlling shareholders, actual controllers, equity/asset transfers, names, and business scopes [31].

Core Viewpoint - The recent joint release of the "Opinions on Further Ensuring and Improving People's Livelihoods" emphasizes the importance of optimizing fiscal expenditure structure to strengthen basic livelihood financial guarantees [1] Group 1: Increased Investment in Livelihood - This year, fiscal investment in the livelihood sector has increased, with national education expenditure, social security, and employment budget arrangements nearing 4.5 trillion yuan, reflecting growth rates of 6.1% and 5.9% respectively [2] - Employment is prioritized as the largest aspect of livelihood, with central fiscal arrangements for employment support funds amounting to 66.74 billion yuan [2] - The government is also enhancing basic pension security, with the minimum standard for urban and rural residents' basic pensions increased by 20 yuan, benefiting over 300 million elderly individuals [2][3] Group 2: Support for Basic Medical and Educational Services - The per capita fiscal subsidy standard for basic public health services has been raised to 99 yuan per person per year, while the subsidy for urban and rural residents' medical insurance has increased by 30 yuan to 700 yuan per person per year [3] - Central fiscal arrangements for student aid funding amount to 80.945 billion yuan, aimed at improving national scholarship standards and expanding policy coverage [3] Group 3: Optimizing Fiscal Expenditure Structure - The "Opinions" call for local governments to enhance responsibility and optimize fiscal expenditure structure, ensuring that basic livelihood financial guarantees are prioritized [4] - In the first five months, social security and employment expenditures reached 2.0054 trillion yuan, a year-on-year increase of 9.2%, while education expenditures were 1.7455 trillion yuan, growing by 6.7% [4] Group 4: Role of Transfer Payments - Central fiscal transfer payments have increased to 1.03415 trillion yuan, reflecting a year-on-year growth of 8.4%, aimed at enhancing local financial capacity and ensuring basic livelihood guarantees [6] - The emphasis on transfer payments is crucial for promoting equal access to basic public services across regions, addressing disparities in fiscal capacity [7]