Research conclusion
Event: on May 16, the National Bureau of statistics released the latest economic data. In April, the industrial added value was – 2.9% year-on-year, compared with the previous value of 5%; Retail sales of social consumer goods were – 11.1% year-on-year, with the former value of – 3.5%; From January to April, the total investment in fixed assets increased by 6.8% year-on-year, with the previous value of 9.3%.
The economic data in April reflected the disturbance of the epidemic, and the degree of impact was still consumption production investment. In this round of epidemic, the GDP of Shanghai and Jilin, which have been sealed for a long time, accounted for nearly 5% of the country, and the industrial added value accounted for nearly 4% (2021 data). As a result, the extent of economic damage in April was second only to that in February and March 2020. Consumption, production and investment declined in varying degrees, and the employment pressure increased significantly. The urban survey unemployment rate in April was 6.1%, second only to that in February 2020. The unemployment rate in the population survey aged 16-24 was 18.2%, a record high.
Similar to the beginning of 2020, the impact of this round of epidemic on various categories of consumption shows differentiation characteristics. The range of impact is catering optional consumption mandatory consumption. At the same time, physical online retail sales rarely show negative growth. The actual year-on-year value of social zero was – 14% (the former value was – 6%), which was the lowest value since March 2020. Catering and commodity retail decreased by 22.7% (the former value was – 16.4%) and 9.7% (the former value was – 2.1%) respectively, indicating that the epidemic had a greater impact on offline contact consumption. At the same time, the online retail volume of physical goods turned negative year-on-year, which was – 1% (the former value was 2.7%) year-on-year in April. One of the reasons was that the epidemic prevention and control led to the decline of logistics efficiency, Secondly, online sales have gradually switched from high-speed growth to medium and high-speed, with growth rates of 25.4%, 19.5%, 14.8% and 12% respectively from 2018 to 2021. In terms of categories, the mandatory consumption remained resilient. Among the retail sales above the quota in April, the retail sales of grain, oil and food reached 10% (the former value was 12.5%) year-on-year, and the optional consumption decreased significantly. In April, the sales of automobiles decreased by 31.6% (the former value was – 7.5%) year-on-year, and the retail sales of cosmetics, gold, silver and jewelry were – 22.3% (the former value was – 6.3%) and – 26.7% (the former value was – 17.9%) year-on-year. However, from the experience of recovery after the epidemic in the past, Optional consumer goods have greater repair elasticity after the impact of the epidemic subsides.
The industrial added value decreased by 2.9% year-on-year (the former value was 5%), of which the manufacturing industry decreased by 4.6% year-on-year (the former value was 4.4%), and the growth rate of leading industries in Shanghai decreased significantly. In April, the industrial added value of automobile manufacturing, pharmaceutical manufacturing and computer, communication and other electronic equipment manufacturing was – 31.8% (former value – 1%), – 3.8% (former value 10.1%) and 4.9% (former value 12.5%) respectively. These industries are the main industries in Shanghai. In addition to the impact of shutdown in some areas, the decline of manufacturing industry also has the spillover effect caused by the decline of logistics efficiency. In April, the vehicle freight flow index of Jiangsu and Zhejiang provinces in the same Yangtze River Delta decreased by 17% and 39% respectively year-on-year. Recently, this problem has been alleviated. After May Day, the decline of Jiangsu and Zhejiang freight index has narrowed to 5% and 23% respectively.
The impact on investment is relatively limited. In April, the fixed asset investment fell by 2.5 percentage points year-on-year to 6.8%, of which the investment in infrastructure and manufacturing maintained a high growth, and the high and volatile PPI is also one of the reasons for the high investment. Although real estate investment has fallen rapidly since the fourth quarter of last year, the decline rate of PPI in this cycle is relatively slow, which plays a supporting role in fixed asset investment. Under the impact of the epidemic, the investment performance of infrastructure and manufacturing industry is not poor, with a cumulative year-on-year rate of 8.3% (former value of 10.5%) and 12.2% (former value of 15.6%) respectively. Real estate investment is still in the downward range. The completed amount of real estate development investment has decreased by 2.7% year-on-year (the previous value is 0.7%), and the accumulated area of purchased land, newly started area, completed area and sales area has decreased by double digits year-on-year. Recently, the marginal relaxation of adjusting measures to local conditions has continued, and the central bank has also lowered the lower limit of the minimum loan interest rate for the first house. However, from the past rounds of real estate cycles, From the adjustment of real estate policy to the recovery of sales side, it will take about 1-2 quarters, and the epidemic has delayed the time point when the policy takes effect.
The epidemic situation is the biggest variable that determines the current macro trend. At present, the new local cases are at the bottom stage, and the economy will stabilize and recover. However, the first round of the epidemic broke out in the Spring Festival, and the impact of this round of epidemic was mainly in the second quarter. Considering that the economy in the second quarter accounted for a quarter of the economy of the whole year, and the current survey unemployment rate was significantly higher than the target of 5.5%, the steady growth policy from May to June is expected to be further strengthened. After the epidemic in 2020, production and investment have gradually returned to the level before the epidemic, but the center of consumption growth is always lower than that before the epidemic. At the same time, the current real estate is still in a downward cycle. Under this background, the pressure of steady growth is of high urgency.
Risk tip: the impact of epidemic prevention and control on the supply chain and demand side is longer than expected.
