Ping An View:
At present, the global economy is facing many challenges, and the global central banks represented by the Federal Reserve are tightening, and international financial risks arise spontaneously. Standing at the crossroads of the recovery cycle after the global epidemic, we look forward to the global economic and financial risks in 2022, and think about the lessons and options of macro policies.
Global economic risks. 1) Covid-19 epidemic risk has not dispersed. At present, "mass immunization" is not feasible, and the transmission of Omicron mutant virus is still uncertain. The risk of covid-19 epidemic spread is very high in the first quarter of 2022, but with the "booster injection" of vaccine and the promotion of covid-19 therapeutic drugs, the global covid-19 epidemic risk is expected to decline in the second quarter of 2022 and beyond. 2) Economic growth carries a heavy burden. The global economy itself is at the end of the recovery cycle, and a new round of epidemic, inflation and supply chain problems have increased the difficulty of "soft landing" of the global economy. 3) Inflation has repeatedly exceeded expectations. Mainstream institutions predict that global inflation will cool down in 2022, and it is difficult to falsify the "temporary theory of inflation". However, the trend of global inflation is still uncertain, and the growth rate of inflation indicators in most economies may still be higher than the pre epidemic level. At this stage, "inflation" has become a catalyst for "stagnation", and the risk of "runaway" inflation expectation has increased. 4) Energy transformation faces challenges. The actual global energy consumption has not increased sharply, and the supply side is "artificially" suppressed mainly due to the problem of energy transformation. Extrapolating from the current supply and demand pattern, the global energy crisis may last for at least half a year to a year. 5) Supply chain bottlenecks are difficult to resolve. The bottleneck of the current round of international supply chain is the result of the superposition of "new and old factors". The new factors include the impact of the epidemic on production capacity and the imbalance between global supply and demand. The old factors include the continuous role of trade protection and industrial policy, as well as the cyclical bottleneck based on global transport capacity.
International financial risks. 1) Overseas central banks are tightening as a whole. The follow-up process of the Fed's tightening in 2022 is more difficult, because taper has a faster pace, it is difficult to guide the expectation of raising interest rates, and other central banks act faster. Central banks such as the United Kingdom and Canada are more "hawkish" than the Federal Reserve, and the European Central Bank is more "Dove". The rise of short-term interest rates is an important signal of the tightening of the financial environment in developed economies. A considerable number of emerging market central banks have "rushed" to raise interest rates. 2) Asset prices in developed markets are "extremely high". We further examined the rationality and adjustment risk of asset prices such as US stocks, US bonds, bulk commodities and US real estate. At the time of global liquidity tightening, asset price fluctuations may be inevitable, and asset prices may interact with inflation. 3) Emerging markets have new resilience and vulnerability. "Austerity panic" may be difficult to reproduce, but some markets also have new vulnerabilities, among which the fiscal deficit and space problems are the most prominent. In 2022, most emerging market fiscal positions are in austerity.
Macro policy thinking. 1) Epidemic prevention policy: strict epidemic prevention cannot be relaxed, but it does not hinder thinking and Research on how to move towards "normalization". Under the downward pressure of economy in 2022, the coordination between epidemic prevention policy and "steady growth" policy may need to be strengthened. 2) Monetary policy: this round of China's post epidemic recovery leads the world, and the economic cycle is also misplaced with most countries. In 2022, the pressure of "stagnation" of China's economy will be greater than "inflation", and the steady loosening of monetary policy should be a relatively determined general direction. 3) Exchange rate policy: the moderate depreciation of the RMB exchange rate may be more appropriate. First, it is to rush back the export boom, and second, it is to release the space of China's monetary policy. 4) Energy policy: the pressure of China's energy transformation is greater than that of Europe and the United States. However, China still has time and space to choose to spend this round of global energy crisis in a relatively stable way. 5) Foreign trade policy: global inflation and supply chain issues provide a rare opportunity to alleviate the medium - and long-term "contradictions" in economic and trade cooperation among countries. China can grasp the window period of easing Sino US economic and trade relations, and strategically increase the import of Shenzhen Agricultural Products Group Co.Ltd(000061) , energy products and other commodities, so as to be more comfortable in the policy of ensuring supply and stabilizing prices.
