Yang DeLong: Central Political Bureau Meeting Deploys Second-Half Economic Work, Consolidates and Expands Recovery Momentum! Seize the Opportunity in A-Share Market, Choose Good Industries and Companies

Today, the National Bureau of Statistics released the July PMI data. The manufacturing PMI for July was 49.3%, a decrease of 0.4 percentage points from last month, indicating that China's manufacturing sector has slowed down slightly.

From an enterprise scale perspective: the PMI of large enterprises was 50.3%, a slight decrease from last month, but still above the critical point. Medium-sized enterprises' PMI was 49.5%, an increase of 0.9 percentage points from last month, below the critical point. Small-sized enterprises' PMI was 46.4%, a decrease of 0.9 percentage points from last month, below the critical point.

From the classification index perspective, among the five classification indices that constitute the manufacturing PMI, the production index was 50.5%, a decrease of 0.5 percentage points from last month, but still above the critical point, indicating that China's manufacturing sector has continued to expand its production capacity. The new order index was 40.4%, a decrease of 0.8 percentage points from last month, indicating that China's manufacturing market demand has slowed down. Inventory index was 47.7%, a decrease of 0.3 percentage points from last month, indicating that China's main raw materials inventory quantity continues to decline. Employment index was 48.0%, an increase of 0.1 percentage point from last month, indicating that China's manufacturing sector has seen a slight recovery in employment sentiment. Supplier delivery time index was 50.3%, an increase of 0.1 percentage point from last month, indicating that China's raw materials suppliers' delivery time continues to speed up.

In July, China's non-manufacturing business activity index (non-manufacturing PMI) was 50.1%, a decrease of 0.4 percentage points from last month, but still above the critical point. From an industry perspective: the construction industry's business activity index was 50.6%, a decrease of 2.2 percentage points from last month. The service industry's business activity index was 50.0%, a decrease of 0.1 percentage point from last month. Rail transportation, air transportation, postal services, cultural and recreational activities, etc. were all above the critical point.

On July 30, the Central Political Bureau meeting was held to analyze and research the current economic situation and deploy second-half economic work. The meeting emphasized that to do well in second-half economic work, we must adhere to the stable growth strategy, comprehensively, accurately, and fully implement the new development concept, accelerate the construction of a new development pattern, maintain policy continuity and stability, enhance flexibility and predictability, focus on stabilizing employment, enterprises, and markets. The meeting also pointed out that we should vigorously promote domestic and international dual cycles to achieve the economic and social development goals for this year and complete the "14th Five-Year Plan" with full marks.

In the first half of this year, China's various work has maintained a stable growth momentum, with macroeconomic recovery accelerating, GDP achieving 5.3% growth, exceeding the initial target set for 5%. However, internal and external instability and uncertainty factors are still relatively many, economic downward pressure is still relatively large, especially in the real estate market demand and investment have been relatively weak, and fixed asset investment growth has slowed down continuously for 32 months, which has had a drag effect on the growth of other industries. Meanwhile, consumer recovery has also been relatively weak, although pushing forward consumption-led innovation has driven rapid growth in mobile phone, tablet computer, and Samsung electronics products, but other consumption growth has been relatively low. In recent years, due to the decline in residents' income and policy effects, restaurants, white wine, etc. have been affected by certain shocks, prices are still hovering at a low level, with CPI down 0.1% in the first half of this year, market confidence and expectations are weak.

In this situation, the meeting emphasized maintaining policy continuity and stability, enhancing flexibility and predictability, and adjusting policies according to changes in internal and external environments, actively responding to shocks from within and without. Predictability is to predict and judge future developments through forecasting and judgment, and proactively adjust and strengthen countercyclical adjustments.

In the second half of this year, macroeconomic policy will continue to be deployed, with a focus on further strengthening fiscal policy, accelerating government bond issuance and use, improving financial resource allocation efficiency, and ensuring the "three guarantees" at the grassroots level. At the same time, we will deepen the implementation of consumer revitalization measures, expand commodity consumption while cultivating service consumption growth points, accelerate major project construction, stimulate private investment vitality, and increase effective investment.

This year, China has been actively promoting domestic big circulation, issuing a series of policies to support expanding domestic demand, promoting production, and fostering a new development pattern. In the first half of this year, final consumption accounted for 52% of GDP growth, making it the main driving force behind growth, with domestic demand contributing 68.8% to GDP growth.

The meeting also emphasized firmly deepening reforms, adhering to technological innovation as the leading force in new development, accelerating the cultivation of new emerging industries that are internationally competitive, and promoting technological innovation and industrial integration. We will also push forward the construction of a unified national market, optimize the competition order in the market, regulate corporate behavior, and enhance the role of key industries.

Currently, with the goal of curbing low-price competition, regulating excess capacity, and fostering high-level opening-up, we will continue to push forward policies that promote the development of new emerging industries. The meeting emphasized that we should expand high-level opening-up, stabilize foreign trade and investment fundamentals, help foreign trade companies strengthen financing support, and promote the development of inland provinces.

The meeting also pointed out that we must continue to prevent and resolve key risks, actively stabilize employment sentiment, and regulate local government debt risk. We will not allow new hidden debts to be issued, and will push forward reforms in a gradual, orderly, and effective manner.

Source: Sina News