China's economy continued to recover in October, with some economic indicators improving from September, including weak fixed asset investment, improved consumption growth and slightly accelerated industrial production, according to data released by the National Bureau of Statistics today.
Consumption and production picked up somewhat, while investment was weak
Investment in fixed assets grew steadily.From January to October, China's investment in fixed assets (excluding rural households) reached 4.45823 trillion yuan, up 6.1% year on year and 3.8% on two-year average, unchanged from January to September.By sector, infrastructure investment grew by 1.0 percent year on year, or 0.3 percent on average for the two years, 0.1 percentage point lower than in the first nine months of this year.Manufacturing investment grew 14.2% year on year, with a two-year average growth of 3.8%, up 0.5 percentage points from January to September.Investment in real estate development rose 7.2 percent, a two-year average growth of 6.8 percent, down 0.4 percentage points from the January-September period.
Consumption growth has picked up.In October, retail sales of consumer goods grew 4.9 percent year on year, up 0.8 percentage points from the january-September period, with a two-year average growth rate of 4.6 percent.Sales of automobiles and home appliances fell 11.5% and increased 9.5%, respectively.
Exports maintained relatively fast growth.From January to October, the total value of China's exports (in dollar terms) grew by 32.3% year on year, in which October fell by 1.8% month on month and grew by 27.1% year on year, down by 1.0 percentage points compared with the previous month.
Industrial production accelerated slightly.In October, the added value of industrial enterprises above designated size increased by 3.5 percent year on year, or 5.2 percent on average for the two years, up 0.2 percentage points from September.Among the main steel products, the output of industrial robots and metal cutting machine tools kept growing. The output of power generation equipment declined year on year. With the improvement of chip supply, the year-on-year decline in automobile output narrowed significantly.
Economy in stage bottom
In October, the macroeconomic climate was low, the performance of external demand was stronger, and the domestic demand was still weak.In domestic demand, infrastructure investment has not improved significantly, and real estate investment continues to drag down fixed asset investment.Consumption growth picked up somewhat, which is related to price increase. In commodity retail, the growth rate of petroleum and products with higher price increase increased greatly. After deducting the price factor, the growth rate of total retail sales of consumer goods in October dropped from the previous month.
At the production end, the market has strengthened efforts to ensure supply and price stability, natural disasters, power shortages and other periodic constraints have weakened, and industrial production has shown positive changes. The growth rate has picked up slightly, but the improvement in industrial production has been small because demand has not been significantly boosted.
Export and real estate investment were the main driving forces for economic recovery in the early stage. At present, export has reached the top, while real estate investment continues to weaken. The expected infrastructure investment has not been improved, and consumer demand is still recovering.
Expectations of steady policy growth have risen
Level of domestic economic growth has been lower than the potential growth in the third quarter, in October data, fixed asset investment, total retail sales of social consumer goods, both the average annual growth rate below the level before the outbreak, the economy is on the stage, at the bottom of the policy of steady growth expected to ascend, macro policy in our country, there is still space policy to speed up the power to promote economic growth to a reasonable level of recovery.
In the face of new downward pressure on the economy and new difficulties for market players, China has effectively carried out anticipatory adjustments and fine-tuning, The State Council's regular meeting said on Nov. 2.The Ministry of Finance said the issuance of new special bonds this year should be completed by the end of November, which will help expand effective investment.
The central bank will maintain a prudent monetary policy tone. At a meeting of the Party Committee of the CENTRAL Bank on Nov. 12, the central bank stressed a cross-cycle design and coordinated policy coordination between this year and next year to better support the recovery of consumption and investment and curb excessive price increases.Recently, the Central bank launched the Carbon Emission Reduction Support Tool, a structural monetary policy tool, focusing on clean energy, energy conservation and environmental protection, and carbon emission reduction technology, which will play a more cross-cycle regulatory role.If inflationary pressures ease, the monetary policy target may shift to stable economic growth, or there may still be room for easing.
The economy may improve later
In October, the influence of external factors weakened and the economy recovered somewhat, but the improvement was not obvious. The new orders index of the manufacturing PMI index continued to fall in that month, and remained in the contraction range for two consecutive months, reflecting that domestic demand was still weak.Overseas, the global economic recovery is approaching the top, the MANUFACTURING PMI in Europe and the United States is falling, the Federal Reserve is about to start to reduce the scale of bond buying, overseas industrial products demand is reaching the peak, the index of new export orders in China's manufacturing industry has been in the contraction range, the high export growth may not be sustainable, the economic recovery is more dependent on domestic demand.
Later period economy improves basically see fixed asset investment and consumption situation.In terms of fixed asset investment, the real estate market entered a downward phase. According to the statistics of the National Bureau of Statistics, the decline of commercial housing sales and new construction area increased in October. Real estate investment is still under pressure, and the improvement of industry financing environment will stabilize investment to a certain extent.There was support for investment in infrastructure. The issuance of special government bonds was accelerated, and some major projects planned for the 14th Five-Year Plan were gradually implemented, which was conducive to the gradual increase in infrastructure investment.There is room for improvement in manufacturing production, and manufacturing investment is expected to remain stable.
Consumption is the biggest driving force for economic growth and the most important variable affecting the future economic trend. There is room for improvement in household consumption, but due to repeated outbreaks, it may remain weak in the short term and the probability of rapid improvement is low.
Construction steel demand is expected to be weak, manufacturing or resilient
The reasonable demand for loans in the real estate industry is being met, but it is not a trend change. In October, the decline of new construction area expanded significantly, and the real estate is still a drag on the construction industry steel.In October, the construction industry new order index recovered to the expansion range, civil engineering construction industry new order index rose for two consecutive months, infrastructure investment demand is expected to release, which is conducive to stable construction steel demand.
Grew up slightly in October, manufacturing, the main industry, general equipment, special equipment, electrical machinery and equipment and other industries slowed, auto decline narrowed, auto production yoy, later period, along with factors such as electricity gradually eliminate, manufacturing production is expected to gradually recover, manufacturing steel demand is expected to remain resilient.