In February, the cumulative industrial added value recorded 7.50% year-on-year, significantly higher than the expected 4.30 percentage points. One of the reasons is that the production index of large and small enterprises "goes against each other"; In February, the cumulative completion of fixed asset investment recorded 12.20% year-on-year, 6.90 percentage points higher than expected. Manufacturing investment and infrastructure investment are the driving items, while real estate investment is the drag items; It is estimated that the growth rate of fixed asset investment will remain at a certain level in 2022, which will play a strong role in driving the macro-economy; From January to February, the urban survey unemployment rate rose systematically, mainly due to seasonal factors and the impact of the epidemic. It is expected that the employment priority policy in the later stage will continue to "improve the quality and strength"; In February, the total retail sales of social consumer goods recorded 6.70% year-on-year, which is a better reading. It is expected that the cumulative year-on-year probability of the total retail sales of social consumer goods in March will be lower than that in February.
In February, CPI recorded 0.90% year-on-year, unchanged from the previous value. It is expected that the high probability in March will rise on the basis of February; There are three main channels for the direct impact of the "Russia Ukraine conflict" on China's inflation, but it is expected that the impact of the "Russia Ukraine conflict" on China's CPI is limited; Under the double negative conditions of base and tail, the PPI of superimposed means of production decreased year-on-year in the current month, and the PPI in February decreased by 0.30 percentage points compared with the previous month; Looking forward to March, the base effect, tail warping factors and new price rising factors form a hedge. It is expected that the probability of PPI falling sharply year-on-year in March is low; The sensitivity of international copper price to macro economy is stronger than that of international oil price, with a leading time of 0-4 months.
From January to February, China's fiscal expenditure accelerated. From the perspective of fiscal surplus, the fiscal situation from January to February is better than seasonal; From the perspective of revenue growth of the five major taxes, it is expected that most of them will decline compared with February. Therefore, we believe that the growth rate of tax revenue in March will probably decline compared with February; In February, the fiscal expenditure of people's livelihood was 2.29 times that of infrastructure. The fiscal expenditure of people's livelihood accounted for 24.44 percentage points higher than that of infrastructure, indicating that people's livelihood rather than infrastructure is the top priority of fiscal expenditure. However, it is expected that the proportion of people's livelihood in fiscal expenditure in the whole year will be lower than that in February; In March, the cumulative year-on-year probability of land transaction price continued to be under pressure, and the expected weakening is one of the reasons for the weakness of the real estate market.
The "problems and challenges" from overseas mentioned in the government work report will continue in the medium and short term; China's "problems and challenges" are difficult to be greatly alleviated in the short term; The economic growth target of "about 5.5% is fully in line with our expectations, but" hard work is needed "; In the face of new downward pressure, "steady growth" is the top priority of the government's work; Macro policies have space and means, and we should strengthen cross cyclical and counter cyclical regulation; After excluding the base effect, the growth rate of export, manufacturing investment and infrastructure investment in 2022 is "high before low"; The unemployment rate of urban survey in 2022 is higher than that in 2021; The "government work report" re mentions "implementing policies for the city" and "urbanization", which will benefit the growth rate of real estate investment.
The financial stability and Development Commission of the State Council pointed out that the current situation is "complex", and the conflict between Russia and Ukraine ranks first in the current complex situation; The conflict between Russia and Ukraine is essentially a confrontation between the United States and Russia, and the possibility of extending to 2024 cannot be ruled out; In the context of the "good start" of the macro-economy from January to February, whether to reduce the "steady growth" is the focus of the market. Considering the hidden worries of the medium and short-term macro-economy, the "steady growth" still ranks first in the government target system; In the process of "steady growth", the probability of monetary policy plays an important role. Among them, "wide credit" takes precedence over "wide currency"; The real estate issue is one of the core issues of the current macro-economy. The meeting proposed to effectively prevent and resolve real estate risks. The Ministry of Finance responded that it would not expand the pilot cities of real estate tax reform this year; The goal of the meeting is to maintain the stable operation of the capital market and jointly maintain the stable development of the capital market.
The premise of judging the trend of large categories of assets under the background of "Russia Ukraine conflict" is to judge the trend of "Russia Ukraine conflict". For this, our basic view is that the short-term probability of "Russia Ukraine conflict" will be upgraded, and the medium and long-term may not be optimistic; "Russian Ukrainian conflict" is bad for the global economy from multiple angles, probably delaying the time point, intensity or process of countries withdrawing from easing policies; The "Russia Ukraine conflict" has benefited the international gold price in the short and medium term, while the international oil price is facing a situation of "short, much and hollow".
