Core Viewpoint - The article discusses the current economic situation in China, highlighting the mixed performance of consumption, industrial production, and investment, indicating a potential lack of sustainability in the recent economic recovery [7]. Consumption - In May 2025, retail sales showed a cumulative year-on-year growth rate of 5.0%, up 0.3 percentage points from April, driven by government subsidies and increased consumer travel [7][18]. - The demand for gold and jewelry has increased due to rising gold prices, but this consumption is not stable and may not be sustainable if income does not improve [7]. - The overall consumer sentiment is cautious, with a preference for using savings over loans for consumption, reflecting a weak growth in new short-term loans [7]. Industrial Production - The cumulative year-on-year growth rate of industrial added value in May 2025 was 6.3%, a decrease of 0.1 percentage points from April, indicating a slowdown in industrial production [7]. - The Consumer Price Index (CPI) remained in negative territory at -0.1%, suggesting ongoing deflationary pressures [7]. Investment - Fixed asset investment showed a cumulative year-on-year growth rate of 3.7% in May 2025, down 0.3 percentage points from April, with real estate investment declining by 10.7% [7]. - Infrastructure investment grew by 10.42%, but this was also a decline of 0.43 percentage points from the previous period, indicating a weakening trend across various sectors [7]. - The article emphasizes that the real estate sector requires additional policy support to stabilize [7]. Market Outlook - The bond market is expected to remain in a favorable position due to a loose monetary policy and weak real financing, with a recommendation to maintain duration and wait for positive developments [7]. - The recent strong performance in credit bonds is attributed more to expectations rather than actual capital movement from deposits to non-banking sectors [7].

Group 1: Economic Resilience - In May, industrial production year-on-year growth decreased from 6.1% to 5.8%, maintaining a high growth rate, with a month-on-month growth of 0.61%[1] - Government bond net financing reached 6.3 trillion yuan in the first five months, an increase of 3.8 trillion yuan year-on-year[1] - M2 and social financing balances maintained year-on-year growth rates of 7.9% and 8.7%, respectively, indicating strong monetary support[1] Group 2: Investment Trends - Total infrastructure investment year-on-year growth decreased from 10.9% to 10.4%, still above the 2024 annual rate of 9.2%[2] - Manufacturing investment year-on-year growth was 8.5%, slightly down by 0.3 percentage points from the previous month, but still at a high level[2] - Public utility investment, including electricity, grew by 25.4% year-on-year, while water conservancy investment increased by 7.2%[2] Group 3: Real Estate Market - Real estate investment fell by 10.7% year-on-year, with the decline expanding by 0.4 percentage points compared to the previous month[2] - The area of newly started construction decreased by 22.8% year-on-year, indicating significant contraction in the sector[2] - The price index for second-hand homes in 70 large and medium-sized cities fell by 0.5% month-on-month, with the decline widening compared to the previous month[2] Group 4: Consumer Spending - In May, retail sales of consumer goods grew by 6.4% year-on-year, exceeding the market expectation of 4.9%[3] - The "trade-in" policy significantly boosted consumption, with home appliance and audio-visual equipment sales increasing by 53% year-on-year[3] - Social financing increased by 2.29 trillion yuan, surpassing the expected 2.05 trillion yuan, indicating robust financial support for the economy[3]

关注、加星，第一时间接收推送！ 文 | 赵伟、屠强、贾东旭 联系人| 屠强、耿佩璇 摘要 4%；房地产投资累计同比-10.7%、预期-10.5%、前值-10.3%；新建商品房销售面积累计同 比-2.9%、前值-2.8%；工业增加值当月同比5.8%、预期5.7%、前值6.1%。 核心观点: 节假日分布差异、电商促销、出口与投资下滑，导致消费与生产背离 消费：电商促销前置与假期增加（同比去年多2天）带动需求集中释放。 5月社零增速创2024年 以来新高。有两大原因。1、电商促销前置带动限额以上零售反弹。家电（+14.2pct至53.0%） 和通讯器材（+13.1pct至33.0%）明显改善；2、5月假日（含周末）比去年同期多2天，直接驱 事件: 5月，社零当月同比6.4%、预期4.9%、前值5.1%；固投累计同比3.7%、预期4%、前值 动出行需求的集中释放。限额以下商品零售（+1.2pct至5.2%）和餐饮收入（+1.3pct至 13%）、服务业零售额（累计同比+0.1pct至5.2%）均改善。 投资：固定投资走弱，主因设备更新周期退坡与传统基建地产回落，但服务业投资继续提速。 5 月固定投资当月同比回落0.7 ...

Consumption - In May, the retail sales growth rate reached 6.4%, exceeding expectations of 4.9% and the previous value of 5.1%[8] - The increase in retail sales was driven by e-commerce promotions and an additional 2 days of holidays compared to last year, leading to concentrated demand release[2] - Significant improvements were noted in household appliances (+14.2 percentage points to 53.0%) and communication equipment (+13.1 percentage points to 33.0%) sales[9] Investment - Fixed asset investment growth slowed to 3.7%, below the expected 4%, with a monthly decline of 0.7 percentage points to 2.8%[8] - The decline in investment was primarily due to the end of the equipment renewal cycle and a drop in traditional infrastructure and real estate investments[3] - Real estate investment fell by 10.7%, slightly worse than the expected decline of 10.5%[8] Production - Industrial value-added growth in May was 5.8%, a decrease of 0.3 percentage points from April[25] - Manufacturing production saw a significant decline, down 0.4 percentage points to 6.2%, influenced by fewer working days in May compared to last year[25] - The decline in production was exacerbated by weak real estate and export sectors, particularly affecting transportation equipment and electrical machinery[25]

Economic Performance Overview - In May, the national economy demonstrated stable growth with industrial added value increasing by 5.8% year-on-year and 0.61% month-on-month, while the cumulative growth from January to May reached 6.3% [1] - Retail sales of consumer goods totaled 41,326 billion yuan in May, marking a 6.4% year-on-year increase, which is 1.3 percentage points higher than the previous month [1] - Fixed asset investment (excluding rural households) amounted to 191,947 billion yuan from January to May, reflecting a 3.7% year-on-year growth, with a notable 7.7% increase when excluding real estate development investment [1] Economic Characteristics - The economy exhibited five key characteristics: stable growth supported by policy measures, steady operation with a decreasing unemployment rate, continuous improvement in domestic demand and production supply, accumulation of new growth drivers in high-end manufacturing and digital economy, and resilience in the face of external challenges [2][3] - The overall economic performance in May was characterized by strong resilience and vitality, with macro policies working in coordination to support stability [3] Price and Real Estate Market - In May, the Consumer Price Index (CPI) showed a slight decline year-on-year, influenced by international factors and falling food prices, while the core CPI's growth rate steadily expanded [4] - The real estate market remained stable, with a narrowing year-on-year decline in housing prices across 70 major cities and a continuous reduction in inventory [4] Consumption and Investment Trends - Consumption growth in May exceeded expectations, driven by policies such as trade-in programs and national subsidies, with retail sales reaching their highest level of the year [6] - Key categories such as home appliances, furniture, and communication equipment saw significant sales increases, indicating the effectiveness of consumption stimulus policies [6] Future Outlook - The economic fundamentals remain strong, with expectations for continued monetary easing and fiscal support for consumption and real estate markets [5][6] - The focus will be on enhancing domestic demand and structural reforms to ensure stable economic growth amid external uncertainties [3]

Group 1: Economic Overview - In May 2025, retail sales (社零) grew by 6.4% year-on-year, significantly exceeding the expected 4.9% and marking the highest monthly growth since January-February 2023[3] - Industrial added value increased by 5.8% year-on-year in May, slightly above the expected 5.7% but down from 6.1% in the previous month[5] - Fixed asset investment for January-May 2025 showed a cumulative year-on-year growth of 3.7%, below the expected 4.0%[5] Group 2: Consumption Insights - The "old-for-new" policy led to a 6.5% year-on-year growth in retail sales of goods, the highest since December 2023, with home appliances seeing a remarkable growth of 53%[4] - Service consumption, boosted by holiday effects, saw restaurant sales increase by 5.9% year-on-year, reaching the highest point since April 2024[7] - The total sales from the five major categories under the "old-for-new" policy reached 1.1 trillion yuan, with approximately 175 million subsidies issued to consumers[4] Group 3: Investment Trends - Manufacturing investment growth fell to 7.8% year-on-year in May, a decrease of 0.4 percentage points from the previous month[12] - Infrastructure investment growth slightly declined to 9.2% year-on-year in May, down from 9.6% in April, primarily due to a slowdown in water conservancy investments[19] - Real estate development investment saw a year-on-year decline of 12.4% in May, worsening from a 10.3% drop in March[25] Group 4: Risks and Future Outlook - The economic recovery is facing challenges, including reduced working days in May and the impact of U.S. tariff policies[2] - There is a need for continued policy precision to enhance domestic economic momentum, as household income growth remains under pressure[2] - The ongoing uncertainty in international trade relations necessitates a focus on strengthening domestic circulation to maintain economic stability[7]

Summary of Key Points from Conference Call Records Industry Overview - The conference call discusses the macroeconomic environment in China, focusing on industrial growth, consumer spending, and investment trends for 2025. [1][2][8] Core Insights and Arguments - **Industrial Growth**: In May 2025, industrial added value exceeded expectations with a month-on-month growth rate higher than previous years, indicating resilience in the production sector. The probability of GDP growth exceeding 5% in the first half of the year is high. [1][2] - **Investment Trends**: Real estate investment continues to decline, with a drop of 10.7% in May 2025. However, manufacturing and infrastructure investments show growth, with manufacturing up 8.5% and infrastructure up 10.4%. Adjustments in local government debt limits are expected to support major project construction in the second half of the year. [5][8] - **Consumer Spending**: Retail sales growth reached 6.4% year-on-year in May 2025, the first time exceeding 6% since last year. The "trade-in" policy and promotional events significantly boosted sales, particularly in home appliances and communication equipment. [6][9] - **Employment Stability**: The urban surveyed unemployment rate remains stable at 5%, consistent with the previous year, indicating a solid overall employment situation that supports economic development. [7][8] - **Economic Outlook**: The economic growth in the second half of 2025 is expected to be weaker than the first half, but fluctuations are anticipated to be minor. The foundation laid in the first half, along with increased local budgets and expanded major project space, supports the likelihood of achieving annual targets. [8][11] Additional Important Insights - **Impact of Policies**: The "trade-in" policy has led to significant sales, with total sales reaching 1.1 trillion yuan from January to May 2025, supported by approximately 130 billion yuan in fiscal funding. However, some regions have adjusted or paused the policy due to rapid fund usage. [4][10] - **Trade Dynamics**: Exports showed a mixed performance, with a 34.5% decline in exports to the U.S. attributed to extreme tariff impacts. Despite this, the reliance of the U.S. on Chinese imports remains high, suggesting a potential for recovery in trade. [15][16] - **Financial Data**: The growth rate of social financing has narrowed, with weak credit performance. Government bond issuance has become a key factor in supporting the economy, and the financial system's support for the real economy has strengthened. [19][20] - **Macroeconomic Policy**: There is a call for maintaining macroeconomic policy stability while promoting domestic demand to foster long-term growth. The necessity of existing policies is emphasized, even with some economic data exceeding expectations. [21] This summary encapsulates the key points discussed in the conference call, providing insights into the current economic landscape and future expectations for the industry.

Economic Performance - In May, the industrial added value above designated size increased by 5.8% year-on-year, slightly exceeding market expectations[2] - The service industry production index rose by 6.2% year-on-year in May, indicating positive service sector performance[13] Consumer Trends - The total retail sales of consumer goods in May grew by 6.4% year-on-year, up from 5.1% in April, driven by the early "618" shopping festival[19] - Major categories such as home appliances and communication equipment saw significant growth, with home appliance sales increasing by 53.0% year-on-year[23] Investment Insights - Fixed asset investment (excluding rural households) grew by 3.7% year-on-year from January to May, below the market expectation of 4.0%[4] - Infrastructure investment increased by 5.6% year-on-year, while real estate development investment declined by 10.7%[4] Employment and Labor Market - The urban surveyed unemployment rate in May was 5.0%, a decrease of 0.1 percentage points from the previous month, indicating a stable employment situation[6] - The job market remains sensitive to external economic conditions, with policies aimed at supporting key demographics such as graduates and migrant workers[6] Market Outlook - The second quarter is expected to see a slight economic slowdown compared to the first quarter, with potential non-linear characteristics due to external uncertainties[1] - A dual bull market in stocks and bonds is anticipated in the second half of the year, supported by easing U.S.-China trade relations and risk mitigation funds[1]

Economic Overview - In May, major economic indicators such as industrial output, services, consumption, and investment continued to grow, with external trade maintaining stable growth despite pressures [1][2] - The retail sales of consumer goods increased by 6.4% year-on-year in May, accelerating by 1.3 percentage points from the previous month [2] - The service industry production index rose by 6.2% year-on-year, up by 0.2 percentage points from April [2] Consumption and Investment - Policies promoting consumption have effectively released domestic consumption potential, with significant growth in retail sales of home appliances and other categories [2] - Investment in equipment and tools grew by 17.3% from January to May, contributing 63.6% to overall investment growth [2] - The production of new energy vehicles, tablets, and electric bicycles saw substantial increases in May, with growth rates of 31.7%, 30.9%, and 20.5% respectively [2] Industrial Performance - The industrial added value increased by 5.8% year-on-year in May, with manufacturing showing resilience despite a slight slowdown [4] - Manufacturing investment rose by 8.5% year-on-year from January to May, although this was a slight decrease from the previous period [4] - The equipment manufacturing and high-tech manufacturing sectors contributed significantly to industrial production, with growth rates of 9% and 8.6% respectively [4][5] Foreign Trade - In May, the total value of imports and exports grew by 2.7%, with exports increasing by 6.3% [6] - Despite a decline in trade with the US, trade with ASEAN, the EU, and Belt and Road countries continued to grow [6] - The import of goods decreased by 2.1% in May, influenced by global trade uncertainties and falling international commodity prices [7] Price Trends - The Consumer Price Index (CPI) fell by 0.1% year-on-year in May, while the core CPI rose by 0.6% [8][9] - The decline in CPI was primarily driven by lower international energy prices and increased supply of food products [8] - The core CPI's increase indicates a gradual recovery in domestic demand and price levels [9] Real Estate Market - The real estate market is showing signs of stabilization, with a narrowing decline in housing prices across major cities [10][11] - New housing sales area and sales value saw a year-on-year decline of 2.9% and 3.8% respectively from January to May [11] - The inventory of unsold properties decreased, indicating a potential recovery in market confidence [11] Economic Outlook - The overall economic performance in the first five months suggests a stable growth trajectory, with expectations for the GDP to maintain a steady pace [12] - Predictions for the second quarter indicate that various projects and infrastructure investments may boost domestic demand [12]

Economic Overview - In May, industrial output and service sector growth rates were around 6%, indicating a GDP growth rate of over 5% for Q2 is likely[1] - Consumer retail sales in May showed a year-on-year increase of 6.5%, driven by policies like "trade-in" and the early start of the "618" shopping festival[5] Consumption Trends - The "618" shopping festival's early launch and "trade-in" policies significantly boosted retail sales, with a month-on-month increase of 0.93%[5] - However, the sustainability of consumer growth is uncertain as reliance on policy support may weaken, and there are signs of demand recovery issues[2] Industrial Production - Industrial value-added growth slowed to 5.8% in May, with significant declines in non-metallic and chemical manufacturing sectors[6] - Export delivery value growth for large enterprises dropped sharply from 7.7% in March to 0.6% in May, indicating a more significant impact from tariffs compared to small enterprises[2] Real Estate Market - Real estate investment, sales, and construction area all saw year-on-year declines in May, with first-tier city housing prices also falling[7] - New policies are being implemented to stabilize the market, including the removal of restrictions in key cities[7] Infrastructure Investment - Infrastructure investment growth rates slightly declined, with broad infrastructure growth at 9.2% and narrow infrastructure growth at 5.1% in May[6] - Despite the slowdown, project approvals by the National Development and Reform Commission remain at historically high levels, suggesting ongoing infrastructure investment intentions[4]