Core Viewpoint - The current low price levels are closely related to the relatively weak domestic demand, and the next phase will focus on boosting internal demand and stabilizing prices, which will positively impact the stabilization of CPI [1][2]. Group 1: CPI Trends - In November, the national Consumer Price Index (CPI) rose by 0.7% year-on-year, the highest increase since March 2024, with a month-on-month increase of 0.5 percentage points [2]. - Throughout the first eleven months of the year, there were six months with negative year-on-year CPI growth, leading to an average CPI that remained flat compared to the previous year [2]. - The core CPI, excluding food and energy, increased by 1.2% year-on-year in November, maintaining a growth rate above 1% for three consecutive months [2][3]. Group 2: Food Prices Impact - The rise in food prices was a significant factor contributing to the increase in CPI in November, with seasonal growth in food prices driving the year-on-year CPI growth [3]. - The impact of food prices on CPI shifted from a negative contribution of -0.54 percentage points in the previous month to a positive contribution of 0.04 percentage points in November [3]. Group 3: Economic Outlook - Analysts caution that the recent rise in CPI should not be oversimplified as a sign of economic recovery, as the supply-demand relationship indicates a significant imbalance with supply being forced to contract [4]. - The overall economic cycle is characterized by demand contraction leading to supply adjustments and declining economic growth, which further exacerbates demand contraction [4]. - The core CPI's upward trend suggests some improvement in domestic consumption demand, but the foundation for sustained improvement remains fragile, requiring ongoing policy support [4]. Group 4: Policy Implications - The adjustment of the CPI growth target from around 3% to 2% reflects a more realistic approach given the current economic conditions, aiming to avoid deflation [5]. - The lower CPI target is seen as a benchmark rather than a ceiling, indicating a policy effort to bridge the gap between nominal and real GDP growth [5]. - Looking ahead to 2026, maintaining stable price growth will remain a key macroeconomic policy goal, with various initiatives expected to support CPI recovery [5].

Core Insights - The Consumer Price Index (CPI) in China rose by 0.7% year-on-year in November, marking the highest increase since March 2024, with a growth rate increase of 0.5 percentage points from the previous month [2] - Despite the low CPI growth throughout the year, the positive signal is that both October and November saw positive year-on-year CPI growth, with November's core CPI (excluding food and energy) rising by 1.2% [2][3] Group 1: CPI Trends - The CPI growth has been low overall this year, with six months experiencing negative year-on-year growth, leading to an average CPI that is flat compared to the previous year [2] - The government's target for CPI growth this year is set at around 2%, which is lower than the previous four years' target of around 3% and the lowest since 2004 [5] Group 2: Economic Implications - The increase in food prices is a significant factor contributing to the rise in CPI for November, with seasonal price increases playing a role [3] - The current economic environment shows a mismatch between supply and demand, with supply being forced to contract in response to shrinking demand, leading to a cycle of economic slowdown [3] Group 3: Future Outlook - Experts suggest that while the core CPI's upward trend indicates improving domestic consumption demand, the foundation for sustained improvement remains fragile, requiring ongoing policy support [4] - The adjustment of the CPI growth target to around 2% reflects a realistic approach given the current economic conditions, aiming to avoid deflation [5]

1. Report Industry Investment Rating - No information provided on the report industry investment rating. 2. Core Viewpoints of the Report - After the domestic policies are implemented, market confidence in stabilizing the economy and the stock market is further strengthened, the index is relatively strong at the bottom, and long positions can be held. One can also try to sell put options to collect premiums. It is necessary to pay attention to the Sino-US trade negotiations this weekend [9]. 3. Summaries According to Relevant Catalogs 3.1行情回顾与后市展望 3.1.1行情回顾 - On May 8th, the Wind All A index rose with reduced volume, opening lower and then oscillating upwards, closing up 0.68%, with over 70% of stocks rising. Among index spot, CSI 300 and SSE 50 opened lower, then oscillated upwards and later declined, closing up 0.56% and 0.33% respectively; CSI 500 and CSI 1000 opened lower and oscillated upwards, closing up 0.41% and 0.76% respectively, with small and medium - cap stocks being stronger. In index futures, futures performed better than spot, with IF, IH, IC, and IM closing up 0.82%, 0.70%, 0.71%, and 1.07% respectively [6]. - In terms of sectors, the communication, national defense and military industry, and power equipment sectors led the gains, rising 2.60%, 2.57%, and 1.62% respectively; the beauty care, non - ferrous metals, and steel sectors led the losses, with declines of 0.96%, 0.43%, and 0.38% respectively [6]. 3.1.2后市展望 - Overseas, the Fed announced to keep interest rates unchanged and stated in the policy statement that tariffs are causing risks of rising unemployment and inflation. Domestically, on May 7th, relevant parties decided to agree to contact the US. Subsequently, the central bank launched a series of measures, including interest rate adjustments and liquidity support tools for specific directions, and continued to support the capital market with funds [8]. - With the implementation of policies, market confidence was significantly boosted, and the A - share market opened higher with a gap. Overall, as the Sino - US tariff stance tends to ease, risk - aversion sentiment cools down. After the annual report disclosure period, investors' risk appetite has increased. After the domestic policies are implemented, market confidence in stabilizing the economy and the stock market is further strengthened [9]. 3.2数据概览 - There are various data charts in this section, including the performance of domestic main indexes, market style performance, industry sector performance, trading volume of Wind All A, trading volume of index spot and futures, open interest of futures, basis trend of main contracts, inter - period spread trend, statistics of main ETF fund shares and turnover, etc., but no specific data summaries are provided in the text [11][13][21][23]. 3.3行业要闻 - On May 8th, the deputy director of the National Development and Reform Commission stated that the National Development and Reform Commission will focus on breaking barriers, expanding space, and optimizing services to promote the implementation of relevant policies. It will launch high - quality projects with a total investment scale of about 3 trillion yuan in key areas [27]. - On May 8th, the spokesperson of the Chinese Embassy in the US responded to questions about Sino - US economic and trade high - level talks, emphasizing that the talks are at the request of the US, China firmly opposes the US abuse of tariffs, and if the US wants to solve problems through dialogue, it should stop threatening and pressuring [27]. - The new issue of Cailian Press "C50 Wind Direction Index" shows that the market expects the social financing growth rate to rebound significantly in April, with new loans likely to increase less year - on - year. The market also expects the CPI growth rate to decline and the PPI decline to continue to widen in April [28].