I. the two sessions of the National People’s Congress will be held soon, and steady growth is the policy focus of this year. The two sessions will be held in Beijing from March 4 to 5, 2022. Prior to this (February 25), the Political Bureau of the CPC Central Committee held a meeting to discuss the draft of the government work report to be submitted by the State Council to the National People’s Congress for deliberation. In the relevant statements on economic work at the Politburo meeting, “we should strengthen the implementation of macro policies and stabilize the overall economic market” was put in the first place. It is expected that steady growth will be the focus of macro policies this year.
2. At the weekend, the United States and Europe announced that some Russian banks were prohibited from using swift international settlement system, which may affect Russia’s export settlement and indirectly affect Russia’s exports of crude oil, natural gas, Shenzhen Agricultural Products Group Co.Ltd(000061) etc. Since the United States and Europe did not specify which banks in Russia were restricted, Russia was prepared to disable swift, and the specific impact was uncertain. In the short term, there is still uncertainty about the impact of the situation in Ukraine on financial markets. But the most panic stage in the market may have passed. Last Thursday, after Russia announced a special military operation in the Donbas region of Ukraine, the risk aversion in the global financial market rose sharply, and the price of gold rose by about 3,5%. Crude oil prices rose by about 9% for fear that Russian crude oil exports would be restricted. However, the price of gold and crude oil all rose later, an important reason is that the sanctions imposed by the United States and Europe on Russia were lower than market expectations. However, over the weekend, the United States, the European Union, the United Kingdom and Canada jointly announced that some Russian banks were prohibited from using swift international settlement system, and implemented “restrictive measures” against the Central Bank of Russia to prevent the Central Bank of Russia from deploying its international reserves in a way that could undermine sanctions. This exceeded market expectations. To some extent, this restricts Russia’s cross-border payment and affects its exports, but the specific degree of impact is uncertain. On the one hand, the United States and Europe have not announced which Russian banks are prohibited from using swift; On the other hand, Russia was threatened by the United States to disable swift in 2014, so Russia launched its own cross-border payment network SPFS. Russia is prepared to disable swift, which will reduce the impact of disabled swift to a certain extent. From the background of high inflation faced by the United States and Europe, if the United States and Europe impose too many restrictions on Russian energy exports, the global crude oil price will continue to rise, and the European natural gas price will rise sharply, which will do great harm to the economy of the United States and Europe. From this perspective, the United States and Europe may only ban swift on some Russian banks, thus partially restricting Russian exports. Generally speaking, banning some Russian banks from using swift will increase the market’s concerns about the supply of crude oil and natural gas, but the specific impact remains to be seen. Considering that both the United States and the European Union said they would not send troops to Ukraine to fight against Russia, the most panic stage in the market may have passed.
Risk tip: China’s steady growth is less than expected, and the situation in Ukraine is deteriorating
