Core view
In the case of the central bank's reduction of reserve requirements and interest rates and government expenditure, M1 and M2 rebounded significantly year-on-year in December, with wide currency first, highlighting the government's willingness to maintain stability, but the wide credit is not significant temporarily, and the bill impulse in the loan sub item is obvious. Looking back, with the financial pre arrangement in 2022, the credit expansion may be on the way.
In December, social finance increased by 2.37 trillion yuan, an increase of 720 billion yuan year-on-year, slightly lower than the expected 2.43 trillion yuan, including 1.16 trillion yuan of new RMB loans and 1.17 trillion yuan of net financing of government bonds, an increase of 460 billion yuan year-on-year. The post financial arrangement in 2021 led to a high net financing of government bonds in the second half of the year, supporting social finance to remain stable.
Broad money first, showing a willingness to maintain stability. In December, the currency was relaxed again. The central bank not only lowered the reserve requirement in an all-round way, but also lowered the one-year LPR interest rate by five bps. Under the trend of wide currency landing, M1 increased by 0.5% to 3.5% year-on-year, M2 also increased by 0.5% to 9% year-on-year, and the enterprise activation funds increased year-on-year. Especially when the net increase of government bonds increased significantly, the increase of fiscal deposits decreased significantly in recent two months, and the use of fiscal funds showed signs of large-scale use, Therefore, M1 and M2 rebounded significantly, highlighting the government's willingness to maintain stability.
The impact of real estate is still, and the wide credit is not significant for the time being. In December, RMB loans increased by 1.16 trillion yuan, of which bill financing was as high as 408.7 billion yuan, and the bill interest rate remained at a very low historical value for nearly a month. Commercial banks were faced with the requirements of credit expansion, superimposed with weak physical financing needs, and were forced to increase the bill discount impulse. At present, the real estate is still relatively depressed under the background of urban implementation. Although the policies in some areas have been relaxed and the mortgage interest rate has been reduced, the decline on the demand side has not been reversed, and the sales of commercial housing is still weak compared with the same period over the years. Dragged down by the transaction area of commercial housing, residents' medium and long-term loans decreased significantly in December.
From the current point of view, the government's goal of maintaining stability is relatively clear. The wide currency has been launched, but the wide credit is not significant at present, and the drag on the real estate demand side is still continuing. Under the policy of urban implementation, with the further shift of real estate policy in the third and fourth tier cities and the strength of fiscal expenditure, the government led projects are launched, and the wide credit may be on the road.
Looking back, we are still optimistic about the stock market. The policy intention to maintain stability has become explicit, and the economy and stock market will continue to repair. A shares have little rebound because of the previous small decline, while Hong Kong stocks have more room to rebound because of the previous large decline. Treasury yields may remain low and volatile at the current point.
Risk tip: the global economic recovery is less than expected, and the epidemic situation is more than expected
