Key points of the report
In March, infrastructure investment improved significantly, while consumption, industrial production and service production weakened significantly due to the epidemic. In the first quarter, GDP increased by 4.8% year-on-year, which was also lower than the government's target due to the suppression of the epidemic. In April, the epidemic will still restrain China's consumption, investment, industry and service industry; After May, the epidemic is expected to ease and China's economy will recover significantly. In order to hedge the impact of the epidemic, the State Council has launched steady growth policies for many times since March 30. It is expected that the steady growth in the second quarter will be further strengthened, and the year-on-year growth rate of GDP in the quarter will rise slightly to 5.1%.
Summary:
Data: from January to March, fixed asset investment increased by 9.3% year-on-year, expected to be 8.6%, and the previous value was 12.2%. In March, the total retail sales of social consumer goods increased by - 3.5% year-on-year, expected to be - 0.8%, and the previous value was 6.7%. In March, the industrial added value increased by 5.0% year-on-year, expected to be 5.1%, and the previous value was 7.5%. GDP in the first quarter increased by 4.8% year-on-year and is expected to increase by 4.8%.
Comments:
1. Infrastructure investment improved significantly in March, and the growth rate of fixed asset investment picked up slightly; It is expected that the epidemic will slightly inhibit the investment in fixed assets in April. In March, fixed asset investment increased by 7.1% year-on-year, with an average growth rate of 5.0% in three years, higher than the average growth rate of 4.6% in three years from January to February. By item, investment in real estate, infrastructure and manufacturing increased by an average of 4.2%, 7.7% and 3.6% respectively in three years, with changes of - 2.0%, 5.4% and - 0.8% respectively from January to February. The significant improvement in infrastructure investment is the main reason for the rebound in the growth rate of fixed asset investment. In March, the sales area of commercial housing and real estate investment increased by an average of - 0.8% and 4.2% respectively in three years. The growth rate was lower than that from January to February this year, but higher than that in the fourth quarter of last year, and it was still in the bottom stage; The area of newly started and purchased land decreased by 9.3% and 20.5% respectively in three years, which is still a negative growth, reflecting that the expectations of developers are still relatively pessimistic. Short term real estate investment still faces downward pressure; In the medium and long term, it is expected that the local government will reduce the mortgage interest rate due to the city's policies, and the real estate is expected to stabilize. In March, infrastructure investment increased by an average of 7.7% in three years, with a significant increase in growth rate. The epidemic had a slight negative impact on infrastructure in April, but the steady growth will be further strengthened. It is expected that the growth rate of infrastructure investment in the second quarter will be maintained at about 7% - 8%. The growth rate of manufacturing investment fell temporarily in March, and the epidemic slightly inhibited manufacturing investment in April. After May, the growth rate of manufacturing investment is expected to gradually pick up.
Consumption declined in February and March due to the epidemic, and it is expected that consumption in April will also be restrained by the epidemic. In March, the total retail sales of social consumer goods increased by an average of 2.9% in three years, significantly lower than the growth rate of 4.3% from January to February, mainly due to the impact of the epidemic in China. Among them, the growth rate of household appliances, furniture, automobiles and other durable goods consumption and non essential consumption such as gold, silver, jewelry and cosmetics decreased significantly. In April, the epidemic situation in China is still severe, and consumption may decline; After May, the epidemic situation in China is expected to ease and consumption is expected to repair.
3. The epidemic situation restrained industrial production in March and April, and the automobile industry was greatly affected. Due to the suspension of production due to the epidemic, the industrial added value increased by an average of 5.8% in three years in March, significantly lower than the previous value of 7.9%. Among them, the automobile industry is greatly affected, because Shanghai and Jilin, where the epidemic is the most serious, are important automobile producing areas. The epidemic is expected to continue to curb industrial production in April.
4. The epidemic depressed GDP in the first quarter, and it is expected that steady growth will be further strengthened. GDP in the first quarter increased by 4.8% year-on-year, in line with market expectations, but significantly lower than the government target (about 5.5%). The GDP of the secondary and tertiary industries increased year-on-year respectively
5.8% and 4.0%. The growth rate of the tertiary industry is obviously low, and the impact of the epidemic is the main reason. Looking ahead, the epidemic significantly inhibited the economy in April. In order to hedge the impact of the epidemic, the State Council has launched steady growth policies for many times since March 30. It is expected that the steady growth in the second quarter will be further strengthened, and the year-on-year growth rate of GDP in the quarter will rise slightly to 5.1%.
Risk tip: the epidemic spread and real estate weakened significantly
