Bank of China Research Institute: 2019 annual GDP growth of around 6.2%

In September 25th, 2019, the Bank of China Research Institute released the economic and financial outlook for the four quarter of 2019. The report reviews the global and Chinese economic and financial operation and global banking operation in the first three quarters of 2019, and forecasts the economic and financial situation in the fourth quarter of 2019 and the development trend of global banking industry. On the global economic and financial situation, the report argues that in the third quarter of 2019, Global trade frictions intensified, manufacturing production and international investment contracted, business confidence was impacted, and the global economic slowdown was more obvious. Looking ahead, the risks facing the global economy lie in the potential financial volatility caused by global monetary easing and the financial turmoil caused by the vulnerability of some emerging markets. The high-tech industry plays an important role in promoting the American economy. In the future, the competition in science and technology will be an important factor in leading and changing the international political and economic pattern. Uncertainty about Britain's exit from Europe has dragged down the European economy, and delaying it may become a new option. The high dollar index and hedging sentiment have slowed the growth of dollar liquidity in markets outside the United States and led to capital outflows in emerging markets. Easy monetary policy can hardly hide the tightening trend of dollar liquidity.

On China's economic and financial situation, the report thinks that the internal and external environment of China's economy is more complex and severe in the three quarter of this year. External demand slows down and domestic demand is weak. The downward pressure on China's economy continues to increase, and China's GDP growth in the three quarter is expected to further slow down to 6%. Looking ahead to the four quarter, the external environment is still complex and changeable. But with the resumption of the Sino US trade negotiations and the landing and improvement of the "six stability" policy, the positive factors of China's steady economic operation are increasing. It is expected that the Chinese economy will stabilize in the four quarter, and the 2019 GDP growth will be 6.2% left and right. Macro-control policy: Firstly, fiscal policy should increase efficiency; secondly, monetary policy should continue to adjust to counter-cyclical in a timely and appropriate manner; thirdly, accelerate the transformation and upgrading of industrial structure; fourthly, real estate regulation should be mainly stable; fifthly, establish and improve counter-cyclical supervision mechanism.

Regarding the development situation of global banking industry, the report considers that the uncertainties of the global banking business environment have intensified, the financial market turbulence has intensified, and the strict financial supervision has stabilized. It is expected that the trend of differentiation and development of banking industry in major economies will continue throughout the year. China's banking sector continues to maintain a good momentum of development. Although credit risk pressures remain, annual performance is expected to grow steadily. Since this year, the layoffs of large international banks have intensified, especially in the field of investment banking. There are many reasons behind the economic slowdown, the decline of investment banking business, the change of customer behavior, the replacement of information technology and so on. After the LIBOR manipulation case, the major economies such as the US, the eurozone, the UK and Japan are actively looking for a new risk-free interest rate alternative LIBOR. In the context of China's LPR mechanism reform, China's banking industry should constantly strengthen its risk pricing ability and accelerate its adaptation to market competition.