The peak of the epidemic in April had a significant impact on both ends of economic supply and demand. On the one hand, production contracted and the unemployment rate rose further; On the other hand, the contraction of consumption has intensified and the decline of real estate investment has accelerated.
However, supported by the steady growth policy, investment in infrastructure and manufacturing maintained a certain resilience. The added value of industries above designated size was - 2.9% year-on-year in the same month. The total retail sales of social consumer goods decreased by - 11.1% year-on-year. The cumulative investment in urban fixed assets was 6.8% year-on-year and 1.8% year-on-year in the current month; Among them, the cumulative real estate investment was - 2.7% year-on-year and - 10.1% year-on-year in the current month; The total investment in full caliber infrastructure construction was 8.3% year-on-year and 4.3% year-on-year in the current month; The cumulative investment in manufacturing industry was 12.2% year-on-year, and 6.4% year-on-year in the same month.
I. supply: the production momentum is weakening and the employment pressure is rising
Under the impact of the epidemic, the added value of industries above Designated Size in April was - 2.9% year-on-year, 7.9 PCT higher than that of the previous month and the next month, which was the first negative growth since April 2020, and the production kinetic energy of upstream, middle and downstream enterprises weakened comprehensively. Compared with the previous month, the growth rate of the upstream mining industry decreased by 2.7pct to 9.5%, the growth rate of the midstream manufacturing industry decreased significantly by 9.0pct to - 4.6%, and the growth rate of the downstream electric heating, fuel and water production and supply industry decreased by 3.1pct to 1.5%.
By industry, most industries have negative growth in industrial added value, and labor-intensive industries and industries with long value chain have been the hardest hit. Affected by the epidemic situation in Jilin and Shanghai, the growth rate of automobile manufacturing industry decreased significantly by 30.8pct to - 31.8%; The growth rate of general equipment and special equipment manufacturing industry decreased significantly by more than 10 PCT; After becoming positive in March, the growth rate of the textile industry fell sharply by 7.0pct to - 6.3%. The growth rate of high-tech manufacturing and equipment manufacturing fell, but still showed some resilience. Relevant industries such as electronic and communication equipment manufacturing and electrical machinery manufacturing still maintained positive growth, while pharmaceutical manufacturing and aerospace equipment manufacturing fell to a negative growth range.
From January to April, the added value of industries above designated size increased by 4.0% year-on-year, down 2.5pct from the first quarter.
Among them, the growth rate of upstream mining industry was 10.4%, maintaining high growth; The growth rate of manufacturing industry in the middle reaches decreased by 3.0pct to 3.2%, of which the growth rate of high-tech manufacturing industry was 11.5%; The growth rate of downstream electric heating water production and supply industry decreased by 1.1pct to 5.0%.
In April, the service industry production index further deteriorated, with a year-on-year growth rate of 5.2pct to - 6.1% compared with March, with negative growth for two consecutive months. Railway transportation, air transportation, accommodation, catering and other contact service industries were significantly frustrated. From January to April, the year-on-year growth rate of the service industry production index continued to decline by 2.2pct to 0.3%, significantly lower than the level in the same period before the epidemic and significantly lower than the average level in the fourth quarter of last year.
In April, the employment pressure further increased, and the national urban survey unemployment rate rose 0.3pct to 6.1%.
Among them, the unemployment rate of young people aged 16-24 increased by 2.2pct to 18.2%, exceeding the highest level of 16.8% after the outbreak of the epidemic (July August 2020).
II. Fixed asset investment: the momentum slows down
From January to April, the total investment in fixed assets increased by 6.8% year-on-year, 2.5pct slower than that from January to March; In April, the year-on-year growth was 1.8%, 4.8pct higher than that of the previous month and the next month; After the rose adjustment in April, it decreased by 0.82% month on month.
Among them, real estate investment fell into contraction; The marginal growth rate of manufacturing and infrastructure investment slowed down, but it still formed main support for the economy, driving the cumulative growth of total investment by 2.9pct and 1.4pct respectively.
(1) real estate: accelerating the downward trend
As economic growth faces new internal and external pressures, market confidence is low, and commercial housing sales have accelerated their decline. In April, the sales area of commercial houses nationwide decreased by 39% year-on-year, the sales amount decreased by 46.6% year-on-year, and the average unit price decreased by 12.5% year-on-year. Sales remained sluggish, superimposed with credit contraction, and the pessimistic expectations of real estate enterprises did not improve. The growth rate of real estate investment further decreased by 7.7pct to - 10.1%, which dragged down the cumulative growth rate from January to April. Since the outbreak of the epidemic, there has been a year-on-year contraction again.
From the two main components of real estate investment, one is the accelerated decline of Jian'an investment. Due to the contraction of new construction, construction and completion, the total year-on-year growth rate of construction and installation projects in March was only 0.5%. In April, the contraction of new construction and construction area of real estate intensified, with the year-on-year growth rate down 22pct, 17.2pct to - 44.2% and - 38.7% respectively, and the year-on-year completion area was - 14.2%, which was basically the same as that of the previous month. Due to the continued downturn of new construction, with the completion of stock construction projects, the subsequent completed area may accelerate the decline. Second, the land purchase fee may still be low. In April, the year-on-year growth rate of land acquisition area decreased significantly by 16.3pct to - 57.3% compared with March. From the perspective of 100 cities, the land market is still relatively cold, and the number and area of transactions in April contracted by 44.6% year-on-year. From the perspective of 22 pilot cities for centralized land supply, 13 cities have completed the first batch of centralized land supply this year. Except for a few hot cities, the overall auction rate of most cities is still at a high level, and the differentiation of land auction heat among cities is intensified.
In April, the funds in place of real estate enterprises further fell to - 35.5% year-on-year. Observing the source of funds of real estate enterprises, due to the weakening of residents' willingness to buy houses, the year-on-year growth rate of deposits, advance receipts and personal mortgage loans decreased by 15.5pct, 20.3pct to - 53% and - 42.4% respectively compared with March. The year-on-year growth rate of self raised funds and Chinese loans also remained sluggish, with - 6.6% and - 28% respectively.
Looking forward, since the end of April, the real estate policy has released a positive signal of "stable growth". In the future, under the framework of urban implementation, the local real estate regulation policies are expected to be further relaxed and work at both ends of residents and real estate enterprises at the same time. However, as the epidemic continues to drag down residents' income and the expectation of the real estate market has not been substantially reversed, there is still a time lag from real estate sales to real estate investment. It is expected that the downward pressure on real estate investment will still exist in the short term, and it is expected that it will take time for improvement.
(2) infrastructure construction: the growth rate has dropped, and the future can be expected
In April, the marginal growth rate of infrastructure investment slowed down, and the full caliber infrastructure investment increased by 4.3% year-on-year, 7.5pct higher than that of the previous month and the next month; From January to April, the total investment in full caliber infrastructure increased by 8.3% year-on-year, down 2.2pct from January to March In terms of structure, the growth rate of the three major industries has dropped. From January to April, the growth rate of electric heating and water combustion decreased by 6.3pct to 13%, still maintaining a high-speed growth; The growth rate of transportation warehouse and mail industry and water environment public industry decreased by 2.2pct and 0.8pct to 7.4% and 7.2% respectively.
There are two main reasons for the slight year-on-year decline in the growth rate of infrastructure investment. On the one hand, under the impact of the epidemic, poor logistics and shortage of workers affect the construction progress. On the other hand, available funds may shrink:
First, under the background of early issuance and commencement of major projects in various regions and early formation of physical workload, most of the additional special bonds issued since the fourth quarter of last year are expected to have been used; Second, the contraction of tax base, large-scale tax reduction and fee reduction and the sharp reduction of land transfer income have an impact on fiscal revenue. At the same time, fiscal expenditure has increased, and it is more inclined to people's livelihood and other fields in structure, or squeeze out infrastructure funds.
Looking forward, many recent important meetings have proposed to "comprehensively strengthen infrastructure construction". Local project reserves are relatively sufficient, the remaining special debt limit has been issued, and there is the possibility of new funds within the year, and infrastructure investment is expected to maintain a high growth.
(3) manufacturing industry: the growth rate drops and the toughness is strong
In April, the year-on-year growth rate of manufacturing investment decreased by 5.5pct to 6.4% compared with the previous month, which fell back under the impact of the epidemic, but still achieved high growth under the low base; From January to April, manufacturing investment increased by 12.2% year-on-year, down 3.4pct from January to March From the perspective of structure, the driving forces of manufacturing investment from January to April mainly include the following categories: first, the investment in high-tech industry maintained a high growth, with a year-on-year growth rate of 25.9%, 13.7pct higher than the overall growth rate of manufacturing industry; Second, upstream industries such as nonferrous metals, petroleum and chemical industry have experienced shortages and rising prices due to the conflict between Russia and Ukraine. Coupled with the loose marginal policy constraints, the growth rate of investment in related industries has increased.
Looking ahead, manufacturing investment is expected to grow steadily, but the growth rate or marginal decline. The supporting factors mainly come from fiscal policy and structural monetary policy, as well as the correction of the implementation of the "double carbon" policy.
However, the base is gradually rising, the price of raw materials remains high, the epidemic situation in some areas is repeated, and the differentiation of enterprise profits and weakening expectation have not been significantly improved, which will drag down the investment in some manufacturing industries.
III. consumption: increased contraction
In April, consumption growth further declined, and the total retail sales of social consumer goods reached 2.9 trillion yuan, a year-on-year decrease of 11.1%, an increase of 7.6pct compared with March; From January to April, the total retail sales of social consumer goods was 13.8 trillion yuan, a year-on-year decrease of 0.2%. Under the impact of the epidemic, the differentiation of residents' income growth, the rise of Preventive Savings and the restriction of offline consumption scenes have significantly suppressed consumption.
The differentiation between commodity consumption and service consumption intensified, with retail sales of 2.7 trillion yuan, a year-on-year decrease of 9.7%; Catering revenue was 260.9 billion, a year-on-year decrease of 22.7%. In terms of industries, first, the growth of compulsory consumption is significantly better than optional consumption. The food, beverage and medicine in the home category have a positive year-on-year growth, while the clothing, jewelry, cosmetics and cars in the travel optional category have a negative year-on-year growth; Second, car sales fell 31.6% year-on-year, further down 24.1pct from the previous month; Third, with the fall of oil prices and travel restrictions, the retail sales of oil commodities increased by 4.7% year-on-year in April, down 5.8pct from the previous month.
Looking ahead, with the epidemic peaking in Shanghai, the social zero in April may be the low point of the whole year, and the contraction range of social zero in May will be reduced, but it may still maintain negative growth.
IV. forward looking policies: actively "steady growth"
The impact of the epidemic on the economy worsened in April, and the "triple pressure" increased significantly. Looking ahead, the economic situation may ease marginally in May, but the downward pressure is still great. Infrastructure and investment are expected to continue to support the economy, but production and consumption will still be under pressure, real estate risks need to be mitigated, and the high export boom is facing a decline.
Policies still need to be implemented comprehensively to underpin growth.
