Waiting for recovery sometimes From Interpretation of macro data in the second quarter of 2022
The following is the Waiting for recovery sometimes From Interpretation of macro data in the second quarter of 2022 recommended by recordtrend.com. And this article belongs to the classification: Chinese economy.
Since March 2022, a new round of epidemic has led to increased downward pressure on the economy. The meeting of the Political Bureau of the CPC Central Committee held on April 29 set the tone for the current economic work, and the executive meeting of the State Council on May 23 further deployed the “package of policies and measures”. With the effective control of the epidemic in May, the orderly resumption of work and production, and the gradual implementation of macro-control policies, China’s economy will start a new cycle of repair. In this issue, the media express will interpret the macro data and policies in the second quarter of this year. As media spending is closely related to consumption, our analysis will focus on consumption trends.
The main observations are as follows:
Economic pattern – in May, the economic recovery began to show, showing a pattern of leading exports, bottoming investment and warming consumption as a whole: in May, various economic indicators increased, exports increased significantly, and in the category of fixed asset investment, manufacturing investment and infrastructure investment maintained an upward trend, becoming an important support for the economy, but real estate investment needs to be improved; Consumption has been moderately repaired. Referring to the recovery process after the epidemic in 2020, it is also expected to be slow this time.
Consumption status – the marginal of the consumer market has improved, and online channels have driven commodity retail to accelerate the repair; From the perspective of the industry, the consumption of daily rigid demand maintained a steady growth, while the overall rebound potential of upgraded consumption was stronger: in May, the social security sector turned positive from zero month on month, and consumption ushered in marginal improvement. Online retail growth accelerated, which may be an incremental driver in the middle of the year. In terms of industry distribution, the growth of daily rigid demand consumption fluctuated little, while the upgrading consumption sector showed a stronger rebound momentum as a whole, especially the automobile sales showed a deep “V” rebound under the joint support of the policy side and the supply side.
Macro regulation and control – the State Council comprehensively deployed the “package of policies and measures” to ensure that the economy returns to rational operation as soon as possible: on May 23, the executive meeting of the State Council deployed the “package of policies and measures to stabilize the economy”, and the main measures to stabilize the economy include: on the one hand, investment and consumption drive the rapid recovery of the economy, that is, using infrastructure investment to drive the positive cycle of the economy, and promoting consumption policies to release potential domestic demand; On the other hand, market players should be protected to ensure employment and people’s livelihood. The coordinated improvement of all links is expected to promote the economic recovery as soon as possible.
Brand value – the marketing bonus in the recovery cycle is worth grasping: according to historical experience, consumers are more inclined to choose big brands during the economic downturn. For aspiring brands, the courage to “step on the accelerator” during the economic recovery cycle is not only expected to open the gap with competitive products, but also the brand compound interest precipitated from this will bring more lasting growth.
In May, the economic recovery initially appeared, showing a pattern of leading exports, bottoming investment and warming consumption
Compared with April, various economic indicators in may have improved, showing an overall pattern of export > investment > consumption. Although consumption has rebounded, the year-on-year growth rate of zero social security is still negative (-6.7%) due to factors such as the persistence of the epidemic and insufficient consumption scenes. The export toughness is relatively sufficient, and the growth rate in May was ahead of other indicators. From the perspective of investment sector, compared with April, the year-on-year growth rate of manufacturing investment and infrastructure investment accelerated by 0.7 and 3.6 percentage points respectively in May, becoming an important support for the economy, while the slow recovery of real estate investment was a drag on the economy.
Referring to the post epidemic repair process in 2020, consumption will recover at the latest. The epidemic also has a great impact on offline consumption scenes and residents’ income, and it is expected that the secondary repair process of consumption will also be slow.
Note: infrastructure investment is full caliber investment data, including public facilities, such as electricity, telecommunications, tap water, pipeline gas, sanitary facilities, sewage, solid waste collection and treatment; Public works, such as dams, canal works for irrigation and drainage; Transportation facilities, such as roads, railways, ports, airports, waterways.
The marginal of the consumer market has improved, and online channels have driven retail sales to accelerate the repair;
From the perspective of the industry, the consumption of daily rigid demand has maintained a steady growth, while the overall rebound potential of upgraded consumption is stronger
1. The consumer market has been actively improved, and retail repair of goods is better than service consumption
The total retail sales of social consumer goods in May was 3354.7 billion yuan, with a year-on-year growth rate of -6.7%, rebounding by 4.4 percentage points from April, with a month on month growth of 0.05%. It has become a regular for the first time since February this year. Overall, there are signs that the consumer market has recovered, but it still needs time to recover further.
From the perspective of consumption type, compared with service consumption, retail repair of goods is better. According to the Statistics Bureau, compared with the year-on-year growth rate in April, the decline in retail sales in May narrowed by 4.7 percentage points, and the catering revenue narrowed by only 1.6 percentage points. This is due to the lack of offline consumption scenes in Shanghai, Beijing and other places where Hall Food and entertainment venues have not been opened in May, resulting in the slow recovery of service consumption represented by catering.
2. The growth of online retail is accelerating, which may be the driving force of large-scale promotion in the middle of the year
With the improvement of the performance of goods and the “618” e-commerce promotion launched in late May, we will jointly promote the recovery of online consumption. Judging from the 618 sales data released by various e-commerce platforms, they have achieved varying degrees of growth. At the same time, the data released by the Bureau of statistics has also been reflected: from January to may, the online retail sales of physical goods increased by 5.6% year-on-year, 0.4 percentage points faster than that from January to April; From January to may, offline retail sales fell by 3.2% year-on-year, further expanding the decline.
3. The deterministic growth trend of daily rigid demand commodities is significant; The overall rebound momentum of the upgraded consumption sector is the strongest, especially the automobile sector
Since the outbreak in March, based on the demand for stockpiles, the growth rate of rigid demand commodities such as grain, oil, food, beverages and traditional Chinese and Western medicine has been stable, becoming one of the few categories that achieved positive growth from January to May this year. Specifically, grain, oil and food, beverages, and traditional Chinese and Western medicine increased by 12.3%, 7.7%, and 10.8% year-on-year in May, respectively, faster than in April.
It is worth noting that in May, the upgrading consumption sector dominated by gold and silver jewelry, cosmetics and automobiles led the overall rise, with a rebound of 10% to 15% compared with April; In particular, the increase of automobiles was the largest, reaching 15.6%. The realization of the deep “V” rebound of automobiles benefits from the simultaneous efforts of the policy side and the supply side. On the policy side, recently, many places have introduced consumption stimulus policies, which provide many favorable conditions for residents to purchase cars and other behaviors; On the supply side, Shanghai and Jilin are important production areas of auto parts. With the production repair, the backlog of orders in the early stage also began to be delivered, which led to the rapid recovery of auto sales in May in the short term.
The State Council has comprehensively deployed a “package of policies and measures” to ensure that the economy returns to rational operation as soon as possible
In view of the severe economic situation in the second quarter, the meeting of the Political Bureau of the CPC Central Committee held on April 29 clearly required that the epidemic should be prevented, the economy should be stabilized, and development should be safe. Under this working idea, on May 23, the executive meeting of the State Council further deployed the “package of policies and measures to stabilize the economy” (hereinafter referred to as the “package of policies and measures”) to strengthen macro-control and guide the economy to return to rational operation as soon as possible.
1. Prevent the epidemic: after the national upgrading of prevention and control measures, the epidemic ushered in an inflection point in May, and the number of confirmed covid-19 cases decreased significantly, providing an opportunity for enterprises to resume work and production. In May, the industrial added value increased by 0.7% year-on-year, from negative growth in April to positive, and the productivity was repaired. In addition, the manufacturing purchasing managers’ index (PMI) was close to 50% in May, returning to the boom and bust line, and the economic boom gradually rebounded.
2. Stabilize the economy: the development goal of the second quarter is to ensure that the economy achieves reasonable growth and the unemployment rate drops as soon as possible. The corresponding main measures include: on the one hand, investment and consumption drive the rapid recovery of the economy, that is, using infrastructure investment to drive the positive cycle of the economy, and promoting consumption policies to release potential domestic demand; On the other hand, market players should be protected to ensure employment and people’s livelihood.
Provide a strong financial guarantee for infrastructure investment, and realize the comprehensive effect of expanding effective investment, promoting employment and promoting consumption. The “package of policies and measures” requires that the issuance and use of 3.45 trillion yuan of special bonds issued this year should be accelerated, and the issuance should be basically completed by the end of June, and strive to be basically completed by the end of August. On June 30, the national Standing Committee once again clarified the measures of policy oriented and developmental financial instruments to support the construction of major projects, raising 300billion yuan through the issuance of financial bonds, etc., to supplement the capital of major projects, including new infrastructure. Finally, the linkage of fiscal and monetary policies to leverage larger-scale infrastructure projects will help to expand the effect of work relief: provide migrant workers, people out of poverty and other large-scale jobs, support them to increase their income through labor, and then stimulate County consumption.
Take mass consumption as the starting point and consumption vouchers as the carrier to actively release consumption potential. The “package of policies and measures” proposes to steadily increase the consumption of automobiles, household appliances and other bulk commodities. At the same time, the Ministry of industry and information technology and other departments jointly launched a new round of new energy vehicles to the countryside. In addition, many governments subsidize digital consumption of household appliances and actively promote green and energy-saving consumption. In the short term, as described above, automobile consumption has rebounded significantly in May; In the long run, the recovery of bulk consumption will help the continuous upgrading of consumption. In terms of consumer vouchers, as of early May, at least 19 provinces across the country planned to issue consumer vouchers, with a total amount of more than 5billion yuan, of which at least 11 provinces and cities planned to issue consumer vouchers of more than 100 million yuan.
Relieve market players and reduce their burdens, so as to stabilize and expand posts and ensure employment. The national urban survey unemployment rate in May was 5.9%, down from April, but still at a high level. Among them, the unemployment rate of young people aged 16-24 is 18.4%, continuing to set the highest level since records began. The “package of policies and measures” further reduced the burden and tax rebates for various market entities, so as to stabilize employment and promote income growth. Specifically, based on the scale of tax rebates retained at the beginning of this year, more than 140 billion yuan of tax rebates were increased, and the total amount of tax rebates and reductions throughout the year was 2.64 trillion yuan, increasing cash flow for enterprises and maximizing the protection of market players, employment and people’s livelihood.
3. Overall development and safety: under the overall upward trend of the investment sector, real estate investment has become a drag on the economy, which is not conducive to overall development. From January to may, the year-on-year data of real estate investment and sales further weakened. Compared with January to April, the growth rate decreased by 1.3%, 2.7% (sales area) and 2% (sales volume) respectively. The large scale, long chain and wide coverage of the real estate industry have an important systematic impact on economic and financial stability and risk prevention. In order to guide the steady and healthy development of the real estate market in the economic downturn stage, the central government once again clarified the guiding framework of “implementing policies for cities”, and further loosened the real estate through financial, policy and other means. It is expected that real estate investment in the second half of the year is expected to bid farewell to the downward range.
The marketing bonus in the recovery cycle is worth grasping
The re impact of the epidemic has brought great pressure on the growth of China’s advertising market, which is expected to increase by about 3% in 2022. Compared with last year, the proportion of Internet advertising spending has further increased to 90%, but the growth rate has slowed significantly, which is expected to be 6.6%; Compared with the negative growth trend of other media, the competitive advantage of Internet advertising still exists. Although the media market has contracted significantly this year, opportunities are often brewing in crises. According to historical experience, consumers are more inclined to choose more well-known and trusted big brands during the economic downturn, which proves in reverse that big brands have stronger competitive advantages and brand barriers. For aspiring brands, they should have the courage to “step on the accelerator” during the economic recovery cycle – strengthen brand building, and use scientific marketing means to seize the minds of consumers. On the one hand, it is expected to open the gap and expand its share with competitive products. On the other hand, the brand compound interest precipitated by the continuous improvement of brand strength will also bring more lasting growth. At present, how to choose or not is worthy of brand reflection and grasp.
Data source:
National Bureau of statistics, GroupM e-commerce, “insight into 618 e-commerce marketing in 2022”, National Health Commission, GroupM 2022, “this year, next year”, online public information collation
From: GroupM think tank
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