Report summary
Since mid December, the central bank has placed more and more emphasis on guiding enterprises to reduce their comprehensive financing costs steadily. It is obviously different from the statement before December. Before December, the statement of the central bank was generally to promote the decline of real loan interest rate and the decline of comprehensive financing cost of small and micro enterprises. From the context of the central bank, "real loan interest rate" refers to the real interest rate, and "enterprise comprehensive financing cost" refers to the nominal interest rate. The attitude of the central bank is more inclined to guide the nominal interest rate of the whole real economy down. This report attempts to use the yield to maturity of industrial bonds (Industrial bonds are an important part of the comprehensive financing cost of enterprises) to understand the changes of nominal interest rate and real interest rate of different industries in the past year to a certain extent.
Looking back on the interest rates in the past four years: there is obvious differentiation in the upstream, middle and downstream. On the whole, the nominal interest rate of the upstream manufacturing industry shows a trend of fluctuation and decline in each year. The possible reason is that the upstream enterprises are mainly state-owned enterprises, and the downward trend of interest rate matches the downward trend of risk-free interest rate (i.e. treasury bond yield). However, the PPI fluctuates greatly, and the real interest rate fluctuates greatly after deducting the PPI fluctuation. In 2021, the real interest rate in the upstream industry rebounded significantly due to the lower PPI in 2019201. The change range of real interest rate of midstream manufacturing industry in each year is relatively small, mainly due to the high consistency between the change of nominal interest rate and PPI, so the change of real interest rate is small. The real interest rate of downstream manufacturing industry increased year by year from 2018 to 2020 and decreased slightly in 2021 (the average annual values from 2018 to 2021 were 4.4%, 4.8%, 6% and 5.6% respectively).
Looking back on the yield to maturity of industrial bonds in 2021: the nominal interest rate and real interest rate of upstream, middle and downstream industries show a downward trend in 2021. The main reason for the decline of nominal interest rate is that after the Yongmei incident in 2020, the nominal interest rates of the upstream, middle and downstream experienced a rapid rise at the end of 2020, and the credit environment was repaired in 2021. Meanwhile, as a risk-free interest rate (taking the yield of 5-year treasury bonds as an example), it also decreased by nearly 50bp in 2021. The combination of the two has driven the overall decline of the yield to maturity of industrial bonds. About the real interest rate: the upstream of PPI rose throughout the year and gradually transmitted to the downstream, superimposing the decline of nominal interest rate, driving the overall decline of real interest rate. It is expected that in 2022, with the implementation of the credit easing measures of the central bank, the nominal interest rate of the yield to maturity of industrial bonds is expected to continue to decline. In the transmission of PPI to the middle and lower reaches, the high level of PPI in the upper reaches may fall, and the PPI in the middle and lower reaches may rise. The real interest rates of the upstream, middle and downstream are differentiated: the real interest rates of the upstream may rise significantly, while the real interest rates of the middle and downstream may gradually fall.
Demand: real estate demand, land supply and transaction data rose and fell year-on-year over the same period last month. The transaction area of real estate in 30 large and medium-sized cities (12.27-1.07) increased by 2.0% year-on-year and decreased by 27.3% year-on-year. The two-week data (12.20-1.02) of land supply area in 100 large and medium-sized cities decreased by 71.1% year-on-year and 65.8% year-on-year. The land transaction area of 100 large and medium-sized cities (12.20-1.02) increased by 11.5% year-on-year and decreased by 66.9% year-on-year. The land transaction premium rate (12.27-1.02) was 4.4%, up 1.1 percentage points from last week. In the last week of December (December 27-december 31), the average daily wholesale of cars was 102000, a decrease of 11.2% compared with the end of November.
Production data: the price of thermal coal decreased by 18.6% compared with last week, and the prices of iron ore and rebar increased by 1.0% and 1.3% respectively. Rebar futures inventory rose 134.2% over last week. CRB commodities and Brent crude oil rose 0.9% and 2.4% respectively this week, while copper and aluminum spot rose 0.4% and 1.4% respectively.
