Key investment points
Event: Recently, the Political Bureau held a meeting to analyze and study the economic work in 2022. In this regard, our interpretation is as follows:
The evaluation will be more positive and a good start will be achieved. For the summary of this year's economy, compared with the end of last year, the evaluation of economic work at this meeting is more positive. For example, at the meeting at the end of 2020, it was emphasized to "make arduous efforts" to hand in the answers, and this meeting mentioned that it has been able to "calmly deal with" in the face of century changes and century epidemics. On the basis of last year's "China became the only major economy in the world to achieve positive growth", this year's "China's economic development maintains a leading position in the world". The "14th five year plan" set the tone of the meeting and achieved a good start. The achievements are not only reflected in the fields of science and technology, reform and opening up and people's livelihood. The meeting also emphasized the toughness of the industrial chain and the construction of ecological civilization. In addition, compared with the meeting at the end of last year, this meeting focused less on the difficulties and risks facing the economy. It can be seen that the policy has a positive attitude and sufficient confidence in economic development.
There are demands for stability, and policies seek progress while maintaining stability. In order to welcome the victory of the 20th National Congress of the Communist Party of China, there are certain demands for steady growth in economic work next year. For example, the references of "six stabilities" and "six guarantees" appeared for the first time in this year's Politburo meeting. However, it should be noted that this demand for steady growth is more reflected in the "bottom line thinking", that is, "maintaining economic operation within a reasonable range" and "striving to stabilize the macro-economic market", Avoid breaking through the lower edge of the growth range, so economic growth will tend to be stable relatively, and it is difficult to have big ups and downs. For the setting of the policy, it is emphasized to "keep the word steady and strive for progress while maintaining stability", and the attitude is slightly positive. While macro policies are "stable", they also pay attention to "effectiveness": on the one hand, while continuing the active fiscal policy, they emphasize the need for "precision and sustainability", which may mean that there is little room to increase the total amount of fiscal expenditure, and the deficit ratio and local government special debt targets may be reduced compared with last year; On the other hand, the prudent monetary policy should be "flexible and appropriate" while maintaining reasonable and abundant liquidity. We pointed out in the interpretation of the third quarter monetary policy implementation report that the flexibility of monetary policy will be significantly strengthened before the Fed implements the interest rate increase. We expect that the current round of monetary easing cycle or not just the use of RRR reduction tools.
Meet the reasonable demand for housing and realize a virtuous circle of the industry. Compared with the two Politburo meetings this year, the real estate industry has slightly eased from the tight policy statement. On the one hand, for the demand side, it is emphasized to "support the commercial housing market to better meet the reasonable housing needs of buyers"; On the other hand, for the supply side, it is also mentioned to promote the "virtuous circle" of the real estate industry. Previously, the real estate data fell almost across the board, and the correction of real estate policy has been reflected in the financing end, which will gradually transfer from the downstream of sales to the upstream links such as construction and land purchase. Although there is still downward pressure on real estate investment next year, it is not appropriate to be overly pessimistic under the constraint of "bottom line thinking".
We should focus on reform and pay attention to the people's livelihood. On the policy of reform and opening up, the meeting specifically pointed out two major directions for next year: first, the layout of regional strategies. We should "effectively promote major regional strategies and regional coordinated development strategies" to further narrow the development gap between regions, which is also the meaning of promoting common prosperity. The second is the reform of factor marketization, which points out that we should pay close attention to the pilot work. According to the opinions on building a more perfect system and mechanism of factor marketization allocation issued by the CPC Central Committee and the State Council, the reform focuses on five aspects: land, labor, capital, technology and data, and the release of dividends through the reform can enhance the medium and long-term driving force of the economy, In line with the direction of high-quality development. In addition, compared with the meeting at the end of last year, this meeting pays more attention to social and people's livelihood issues, mentioning the need to "grasp the bottom line of people's livelihood" and give priority to employment, which is in line with the bottom line thinking of steady growth. The implementation of the fertility policy and the improvement of the system of providing basic public services in permanent residence will further optimize the age structure and regional distribution of the population, It is also conducive to medium - and long-term steady economic development.
Risk tip: policy changes, economic recovery is less than expected.
