The implementation of incremental policies boosts market confidence
2024-11-18
The overall indicator has remained stable with an upward trend, becoming a major highlight of financial data in October. According to the statistics of the People's Bank of China, the growth rate of broad money (M2) has increased by 1.2 percentage points in the past two months. The growth rate of narrow money (M1) saw its first improvement this year in October, with a decrease of 1.3 percentage points compared with September. At the same time, the growth gap between M2 and M1 has also narrowed. These changes indicate that, against the backdrop of a series of accelerated policy measures, the activity of the real economy has increased, and the investment and consumption willingness of enterprises and residents has also strengthened. Recently, a package of incremental policies has gradually come into effect, effectively boosting market confidence. The People's Bank of China has carried out significant reserve requirement ratio cuts, implemented effective interest rate cuts, optimized and adjusted real estate financial policies, and created two tools: securities, fund, and insurance company swap facilities and special refinancing loans for stock repurchase and increase holdings, encouraging long-term capital to enter the market and supporting the stable development of the stock market. Overall, the market response is positive and positive, and social expectations have significantly improved. There are also many bright spots in the credit structure. On the one hand, there has been a significant increase in corporate loans, especially medium - and long-term loans, which provides sufficient financial support for stable investment. Data shows that as of the end of October, the balance of loans for specialized, refined, and new enterprises was 4.23 trillion yuan, a year-on-year increase of 13.6%; The balance of loans for technology-based small and medium-sized enterprises was 3.17 trillion yuan, a year-on-year increase of 21%; The balance of inclusive small and micro loans is about 33 trillion yuan, a year-on-year increase of about 15%. These loan growth rates are all higher than the growth rates of various loans during the same period. On the other hand, the growth of personal housing loans has improved. In October, the scale of personal housing loans in China stabilized, significantly better than the average monthly decrease of 69 billion yuan in the previous nine months, and also better than the same period in the previous two years. At present, the stock of social financing scale and M2 balance in China have exceeded 400 trillion yuan and 300 trillion yuan respectively, and the balance of RMB loans has also exceeded 250 trillion yuan. The growth rate of financial total has been maintained at a level that is basically matched with the nominal GDP growth rate and slightly higher, and the financial support is stable. It should also be noted that the stock of financial resources is already at a high level, and it is becoming increasingly difficult to maintain high-speed incremental growth. It is not realistic to blindly seek quantity, which may exacerbate various problems such as idle funds and neglect the fundamental purpose of serving the real economy. The macroeconomic regulatory approach is gradually shifting. Insufficient effective demand, weak social expectations, and low prices are prominent issues that need to be addressed in current macroeconomic regulation. This is not only a manifestation of short-term economic difficulties, but also a reflection of deep-seated contradictions in the medium to long term structural transformation. Pan Gongsheng, President of the People's Bank of China, said in his speech at the annual meeting of the Financial Street Forum this year that in order to promote high-quality economic development and sustainable growth, it is necessary to grasp the dynamic balance between growth speed and quality, internal and external, investment and consumption. From this, it can be seen that the recently introduced package of incremental policies is not a simple stimulus, but a significant adjustment in policy logic. There are not only short-term plans to expand demand, but also a large number of reform and structural adjustment plans. At present, consensus is gradually being reached on strengthening demand side management. In the future, while introducing supportive policies, efforts should also be made to promote reforms and substantially expand domestic demand. The next step of monetary policy will focus more on the combination of quantity and price, and emphasize the role of interest rate regulation. Interest rates affect consumption and investment, have significant implications for the macro economy, and are the core of monetary policy. The People's Bank of China has been promoting the market-oriented reform of interest rates in accordance with the idea of "being open-minded, well formed and well regulated". At present, deposit and loan interest rates have been fully liberalized, and efforts will be made in the areas of "formation" and "adjustment" in the future. 'Forming' requires financial institutions to enhance their independent and rational pricing capabilities, while 'adjusting' requires focusing on interest rate policies to better serve macroeconomic regulation functions and alleviate constraints on interest rate regulation as much as possible. (New Society)
Edit：Yao jue Responsible editor：Xie Tunan
Source：Economic Daily
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