Comment: The market focus on whether the focus of Chinas policy will shift from

Source: Bloomberg

China's economic recovery has entered the right track, and the focus of high -level leaders may shift at the moment that it does not implement additional stimuli, boost corporate confidence, increase employment, and promote the development of the real estate market.

The Central Political Bureau of the Mainland Government Central Committee held in April usually focuses on the economy and sets the policy of the next few months.There is no exact meeting date, but it may be held this week.

Due to the rebound of economic growth, economists are paying close attention to currency and financial support signals.Several major banks have raised China's economic growth forecast this year to nearly 6%or higher, which is much higher than about 5%of the official goals, thereby reducing the necessity of increasing stimuli.

The People's Bank of China has significantly began to cancel the epidemic stimulus measures to guide financial institutions to issue loans to small and micro enterprises in recent years.Local governments have also carried a record of debt, which reduced its ability to increase financial support.

"Once the economy returns to the right track, the People's Bank of China may turn to the watch -looking model to prepare for the normalization of the policy," Yu Xiangrong, chief Chinese economist of Citi Group.

He said that local governments are eager to "restore fiscal toughness", thereby reducing the possibility of large -scale tax cuts, increasing the amount of special debt, or further expanding policy bank financing instruments.

Investors will carefully analyze the tone and wording of the Central Political Bureau of the Mainland Government, and observe whether it is different from the December meeting of last year and the Central Economic Work Conference -this may suggest that the policy will be adjusted significantly.However, there may not be too many details, because policy rules are usually formulated by government agencies after the meeting.

The following are the main points of attention:

The growth prospect is more optimistic

In December last year, Chinese senior leaders emphasized the three major risks facing the economy: shrinking demand, supply impact and expectations.Since the first appearance in December 2021, many policy meetings have mentioned these so -called "triple pressures".

The People's Bank of China remained related wording in a statement of monetary policy meetings in the first quarter. This is the first time since the end of 2021, which has not mentioned "triple pressure" on such occasions.The recent speech by the President of the People's Republic of China, Yi Gang, also shows that the economic prospects are more optimistic.

Chinese observer will evaluate the wording of the Political Bureau of the Central Committee to describe economic risks to measure its confidence in economic recovery.

Promoting consumption, stable employment

China's economic growth in the first quarter set the fastest level in one year, thanks to the strong growth of consumer expenditure after the restrictions on the epidemic, especially the service and other services such as tourism and cateringEssence

However, the recovery is quite unbalanced.The employment market is still sluggish, and the unemployment rate has climbed to a record high.Real estate investment has continued to shrink. Due to the decline in foreign demand and the intensification of geopolitical tensions, the rebound of exports in March may only be temporary.

Guojin Securities said that in the context of economic structural differentiation and imbalance, structural policies to solve industrial, employment and consumption issues may become the focus of attention.Economists such as Zhao Wei stated in the report on Monday that when they found ways to solve the weak real estate market in Beijing, the Politburo or further guided the industrial development.

Government departments are busy studying specific measures to help the economy maintaining growth.The China National Development and Reform Commission is drafting to restore and expand consumer policy documents, and we must make great efforts to stabilize car consumption.The Ministry of Commerce of China stated that it would issue a country's other trade guide to formulate a trade promotion guide for key markets and countries.