Investment summary
Liquidity review in 2021
In the traditional analysis framework, the excess reserve ratio is an important measure of inter-bank liquidity tightness, but at present, the indicator significance of the excess reserve ratio is declining. Under the framework of modern monetary policy, the central bank guided the market interest rate represented by dr007 to fluctuate around the policy interest rate by improving the policy interest rate system with the open market operating interest rate as the short-term policy interest rate and the medium-term lending convenience interest rate as the medium-term policy interest rate. Since 2021, the central bank has guided the market from paying attention to daily operation volume to price indicators and stabilized market expectations through stable operation and expectation management. Dr007 continued to operate smoothly around the policy interest rate, the fluctuation range was narrower than before, and the liquidity was reasonable and abundant.
In terms of broad liquidity, after the impact of the epidemic in 2020 and the abnormal easing of counter cyclical regulation, M2 and social finance showed a downward trend in 2021. M2 stabilized after the second quarter and has returned to the pre epidemic level. However, social finance has been declining. At present, the growth rate is maintained at about 10, which is also lower than that before the epidemic. The continuous decline of social finance is not only the impact of weak demand, but also the constraints of financial supervision, financial postposition and self policy choice on local debt and real estate.
Liquidity outlook for 2022
According to the benchmark of M2 adapting to social integration and nominal economic growth, the appropriate monetary growth rate should be between 7-9. Because the economic operation is actually weak, the monetary authorities actually tend to let the monetary growth be in the upper half of the range. Therefore, we predict that the growth rate of M2 in 2022 will be 7.5-8.5. For social finance, it will also be repaired in 2022. The main drag items will improve in 2022, and the annual growth rate is expected to be 10.5-11.
According to the five factor model of overstocking and the hypothetical analysis and inference based on the changes of various factors, we can get the fund gap of each month in 2022. However, the measured capital gap does not directly respond to the tightness of liquidity. It is also necessary to comprehensively consider the investment of the central bank in the open market and, more importantly, the range regulation of market interest rates in stable expectation management, and the actual situation of price operation will better represent the tightness of liquidity. And compared with specific values, the change trend shown may be more worthy of our attention. For example, according to our calculation, January, June or the time period with high capital pressure throughout the year, while the foundation of loose liquidity in December is stronger. In response to the liquidity pressure in January, the central bank's RRR reduction in December also contributed to the stable and abundant liquidity before the Spring Festival. In 2022, under the precise regulation and stable expectation management of the central bank, the market interest rate is still expected to operate smoothly around the policy interest rate. Although the impact of time point is inevitable, the overall volatility will also decline.
Risk tips
There is a gap between the predicted value and the actual performance; Inflation rose higher than expected, strengthening the constraints on policies; The progress of local bond issuance was less than expected, the credit was weak, and the credit extension process was slow.
