The economic data from January to February significantly exceeded market expectations. This is in line with our forecast of 6% GDP growth in the first quarter, but many people's first reaction is that they can't believe it or even doubt whether the data can be right? We put forward four understandings of this economic data.
First, the first quarter of last year was a low base, not a high base. Although the year-on-year growth rate of various data in 2021 is very high, the month on month growth rate is low, so the first quarter is a low base rather than a high base. We calculated the month on month changes of various data from January to February over the years relative to December of the previous year. It can be found that the month on month growth rates of infrastructure, manufacturing and consumption in 2021 are lower than the historical month on month average. It is more intuitive to observe the month on month growth rate of GDP. The month on month growth rate of GDP in the first quarter of 2021 was only 0.3%, much lower than that in the same period in other years. Therefore, the first quarter of last year was a low base rather than a high base, and the base effect supported the high growth of economic data to a certain extent.
Second, on the basis of low base, the policy has been pushed forward, and the endogenous kinetic energy of the economy has been repaired, resulting in a number of data greatly exceeding expectations. The performance of manufacturing investment, infrastructure investment and consumption in this period is strong. (1) Manufacturing investment continued the strong trend since the beginning of last year, especially the rapid growth of high-tech manufacturing. This year's government work report proposed to "strengthen the incentive for enterprise innovation", In particular, it is pointed out that "we will strengthen the implementation of the policy of adding and deducting R & D expenses and implement the tax rebate of about 1.5 trillion yuan. All the above measures provide large-scale financial support for enterprise innovation and help manufacturing enterprises increase investment in technological transformation and new equipment procurement. (2) infrastructure investment has picked up as scheduled. Since September 2021, the policy has frequently emphasized that infrastructure investment is" moderately ahead of schedule " "Strive to form more physical workload in the first quarter". From January to February, the year-on-year growth rate of infrastructure construction was 8.1%, which initially reflected the effect of "steady growth" of infrastructure construction. (3) China's epidemic prevention and control has become more accurate. During the Spring Festival, residents' travel restrictions have been relaxed, and consumption during the Spring Festival holiday has been released.
Third, the real estate rebounded more than expected, causing market concern. We believe that there are two reasons for the positive growth of real estate investment. First, there has been an increase in the resumption of projects suspended and deferred in the early stage. The construction area in this period increased by 1.8% year-on-year. Because the construction and installation investment in real estate investment is closely related to the construction area, the positive growth of construction area can correspond to the real estate investment. However, considering that the newly started and completed areas fell by 12.2% and 9.6% respectively, we speculate that under the influence of the gradual relaxation of real estate policies, especially the acceleration of mergers and acquisitions of real estate enterprises and the standardized adjustment of commercial housing pre-sale supervision system, real estate enterprises have increased the resumption of projects suspended and deferred in the early stage. Second, real estate investment is current price data, including price impact. In the case of high PPI, the rise in the price of building materials supports the growth of real estate investment.
We maintain the judgment of 6% economic growth in the first quarter. In the annual outlook "social finance recovery, infrastructure recovery and bimodal growth", we have proposed that the economic growth in 2022 may be bimodal; It is expected that the first quarter and the third quarter of 2022 will be double peaks. Driven by the low base + policy, the growth rate in the first quarter is expected to reach 6%. The economy made a good start from January to February, which is in line with our expectations.
Risk factors: vaccine failure caused by epidemic variation; China's policy exceeded expectations
