Home » In the first quarter, the economy got off to a good start and GDP grew by 4.5% year-on-year

In the first quarter, the economy got off to a good start and GDP grew by 4.5% year-on-year

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Fundamentals, industries, and financials all show that the economy is improving

According to the data released by the National Bureau of Statistics on April 18, the economic operation in the first quarter got off to a good start with more positive factors. The fundamentals, industry and financial aspects of the economy all show that the overall economy continues to improve, and market expectations have improved significantly.

Fundamentals: Economic growth stabilizes and picks up

The economic growth in the first quarter showed a clear trend of stabilization and recovery. In terms of growth rate, the gross domestic product (GDP) in the first quarter reached 28,499.7 billion yuan, a year-on-year increase of 4.5% at constant prices, and the growth rate was 1.6 percentage points higher than that in the fourth quarter of last year.

Luo Zhiheng, chief economist of Yuekai Securities, believes that the economic growth rate in the first quarter was significantly higher than the 4% expected by the market, which will help the smooth achievement of the annual economic growth target.

In terms of industries, the added value of the primary industry increased by 3.7% year-on-year, the added value of the secondary industry increased by 3.3% year-on-year, and the added value of the tertiary industry increased by 5.4% year-on-year. The tertiary industry has the best recovery.

Judging from the “troika” driving the economy, the leading role of consumption is obvious. In the first quarter, the contribution rate of final consumption expenditure to economic growth reached 66.6%, higher than the contribution of total capital formation.

Specifically, in the first quarter, the total retail sales of social consumer goods increased by 5.8% year-on-year. Among them, retail sales of goods increased by 4.9% year-on-year; catering revenue increased by 13.9% year-on-year. “Consumption continued to pick up, especially in March when the growth rate of consumption reached 10.6%, and the sales performance of clothing, shoes and hats, gold and silver jewelry, and automobiles all exceeded expectations.” Zhou Maohua, a macro researcher at the Financial Market Department of China Everbright Bank, said.

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In the first quarter, the national fixed asset investment increased by 5.1% year-on-year, slightly lower than the 5.5% in January-February. Infrastructure investment increased by 8.8% year-on-year, manufacturing investment increased by 7.0% year-on-year, and real estate development investment decreased by 5.8% year-on-year. “Infrastructure investment continues to play an important role in supporting economic growth, and the high-growth infrastructure investment is mutually confirmed by the pre-issued special bonds and large-scale leveraging of corporate medium and long-term credit.” Hongta Securities Chief Economist Li Qilin said.

Looking ahead, Fu Linghui, spokesperson of the National Bureau of Statistics, said at a press conference held by the State Council Information Office on April 18 that the endogenous driving force of my country’s economic growth is gradually increasing. Low, the economic growth rate in the second quarter of this year may be significantly faster than that in the first quarter.

Industry: The contact service industry is growing rapidly

In the first quarter, the added value of industrial enterprises above designated size increased by 3% year-on-year, and many industries performed well. Such as the equipment manufacturing industry in the industry, the contact service industry in the service industry, etc.

According to data from the National Bureau of Statistics, in the first quarter, the added value of the equipment manufacturing industry increased by 4.3% year-on-year, 1.3 percentage points higher than that of industries above the designated size, and contributed 42.5% to the growth of industries above designated size. Among them, the added value of electrical machinery, railway and shipbuilding industries increased by 15.1% and 9.3% respectively.

“The supporting role of the equipment manufacturing industry is obvious. With the strengthening of my country’s industrial upgrading trend and the improvement of equipment manufacturing capabilities and levels, production will maintain rapid growth.” Fu Linghui said.

The recovery trend of the service industry is obvious, especially the rapid growth of the contact service industry. In the first quarter, the added value of the accommodation and catering industry, the financial industry, the leasing and business service industry, and the wholesale and retail industry increased by 13.6%, 6.9%, 6.0%, and 5.5% year-on-year respectively.

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“The contribution rate of the service industry to economic growth reached 69.5%, becoming an important factor supporting economic growth. In particular, the contact-type and agglomeration-type service industries rebounded rapidly, and residents went out to eat, shop, travel, and accommodation increased significantly, driving the growth of related service industries .” Fu Linghui said.

In addition, the transformation and upgrading of the industry continues, and new drivers continue to grow. Data show that in the first quarter, investment in high-tech industries increased by 16% year-on-year, significantly faster than the growth rate of all investment. Green and low-carbon products grew rapidly, and the output of new energy vehicles and solar cells increased by 22.5% and 53.2% respectively year-on-year.

Financial aspect: credit supply and demand are booming

In the first quarter, credit got off to a good start, and the goal of “strengthening the frontier” was achieved, showing that the momentum of economic recovery has strengthened, the financing demand of the real economy has heated up, and the credit expansion process has steadily advanced.

In terms of the total amount, RMB loans increased by 10.6 trillion yuan in the first quarter, an increase of 2.27 trillion yuan year-on-year. The financial data exceeded market expectations for three consecutive months; in terms of structure, since last year, the credit structure of “strong enterprises and weak residents” has been unbalanced The phenomenon has improved, and credit expansion at the resident end has begun to take shape; in terms of prices, the loan market quote interest rate reform dividend has been released, and loan interest rates have dropped significantly.

The boom in credit supply and demand is due to the stabilization and recovery of the macro economy: the expansion of corporate production and investment, key infrastructure projects, etc. have a significant boosting effect on credit demand, and the recovery of residents’ confidence drives the recovery of demand in areas such as consumption and housing. At the same time, the policy of stabilizing growth continued to exert force, the proactive fiscal policy strengthened and improved efficiency, and the prudent monetary policy was flexible and moderate, which strongly promoted the growth of money and credit.

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“With the support of policies, endogenous credit demand has also begun to recover from a low point.” CICC said that in March, residents’ short-term loans and medium- and long-term loans both showed significant recovery. The former reflects the rising demand for consumer credit and self-employed operating funds; the latter is consistent with the improvement in real estate sales in March. Judging from recent data, real estate sales have further shown the characteristics of a moderate recovery.

The recent meeting of the Monetary Policy Committee of the People’s Bank of China in the first quarter of 2023 called for further smoothing the monetary policy transmission mechanism, maintaining reasonable and sufficient liquidity, and maintaining a reasonable and stable pace of credit growth.

Analysts believe that with the further recovery of the economy, the financing needs of the real economy will continue to increase. It is expected that liquidity will remain reasonably sufficient, credit expansion will be relatively strong, and the momentum of rapid credit growth will continue, thereby creating a good monetary and financial environment for stabilizing the macroeconomic market. environment.

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