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Home > News > Valuable News > Expert: China's economy will continue to operate in a reasonable range

Expert: China's economy will continue to operate in a reasonable range

ECHEMI 2019-10-25

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The macro-economy is stable in a reasonable range, but the internal and external uncertainties have increased, the external environment has become more complex and severe, and there is still some downward pressure on the economy. Liu Chenhui, deputy researcher of the Institute of economic and social development of Northeast University of Finance and economics, recently released various macroeconomic data in the first three quarters. On the premise of overall stable economic trend, the price level rose, the credit support of real economy continued to grow, and the total value of import and export decreased moderately. Data shows that in September, China's broad money balance (M2) increased by 8.4% year-on-year, RMB loans increased by 1.69 trillion yuan, consumer price (CPI) increased by 3% year-on-year, and total import and export value decreased by 3.3%.

On the whole, the macro-economy is stable in a reasonable range, but the internal and external uncertainties have increased, the external environment has become more complex and severe, and there is still some downward pressure on the economy. In September, CPI growth was 0.2 percentage points higher than that of the previous month, breaking 3 for the first time this year. However, this "break 3" is not reflected in the overall rise in the price level of various commodities, but in the trend of structural differentiation. Among them, affected by the epidemic situation in Africa, the price of pork increased by 69.3%, and the price of poultry, eggs and other food under the impact increased by different ranges, which became the main factor driving CPI higher; at the same time, the price adjustment of food in China and Africa in CPI was relatively small, and producer price index (PPI) decreased by 1.2% year on year. The above structural differentiation shows that the CPI rise is not driven by demand, but mainly due to the short-term abnormal fluctuation under the influence of pork price.

With the situation of swine fever in Africa being gradually controlled and the effect of incentive policies showing, the supply of pork market will enter a period of steady recovery, which will drive the overall price level to stabilize. It is expected that CPI will still fluctuate around 3% in the next few months, but the inflation level for the whole year will be kept within 3%. The resilience of foreign trade has been enhanced, and the regional structure of trade has formed a new trend. According to customs statistics, China's total import and export value fell by 3.3% and 0.7% in September, of which the total import and export value of China and the United States was 329.98 billion yuan, down 75.56 billion yuan from the same month last year. Although the bilateral trade between China and the United States has declined, the development of China's foreign trade has been more resilient, and the general trend of optimizing the structure of foreign trade and accelerating the transformation of power has not changed.

As the world is still highly optimistic about the potential of China's market, China's trade with other major countries and regions has not been negatively impacted, especially the trade with ASEAN has been growing, and the regional structure of trade has gradually formed a new trend. From the data point of view, the total import and export value of China and ASEAN in September reached 402.19 billion yuan, an increase of 9.4% compared with 367.75 billion yuan in the same month last year, of which the export to ASEAN reached 210.69 billion yuan, an increase of 12.6% compared with 187.16 billion yuan in the same month last year. According to the social financing scale and monetary data released by the central bank, under the guidance of moderate and stable monetary policy, China's major financial data continued to improve and exceeded expectations. In September, new RMB loans reached 1.69 trillion yuan, a year-on-year increase of 306.9 billion yuan, a new one month high for this indicator. Among them, corporate loans increased by 1.01 trillion yuan, a year-on-year increase of 334.1 billion yuan. Apart from part of the reasons for the adjustment, the growth of social financing scale is mainly due to the continuous increase of support for real economic credit. At present, the stable monetary policy of the central bank has achieved good results. In the next stage, it is expected that the central bank will continue to implement the policy orientation of targeted support for the real economy, and it is possible to use policy tools such as targeted reduction to achieve targeted investment in manufacturing, private and small and micro enterprises.

Disclaimer: ECHEMI reserves the right of final explanation and revision for all the information.

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