Experts say electricity consumption builds up in May and the recovery is becoming clearer

In the first 5 months of this year, China's electricity consumption year-on-year decline in about 4%. Compared to January-April, the May power consumption decline to stabilize the situation is basically clear.　　Analysts believe that, given the high base last year, the current electricity consumption may have been bottoming out, the macroeconomic recovery trend will be further clarified. Electricity consumption data has always been considered to be one of the barometers of macroeconomic change. Since the 80 's, China's GDP and electricity consumption and installed capacity of the correlation coefficient has reached 0.98, the total economic indicators and total power indicators are highly positive correlation.　　It is estimated that the electricity consumption per increase 1%,GDP corresponding increase of 1.13%. However, the trend of these two highly correlated data has somewhat deviated this year.　　In the first quarter of this year, electricity consumption in the whole society fell by 4.02%, while gross domestic product grew by 6.1% per cent. For this deviation, authorities have pointed out that in the promotion of electricity consumption growth in the three major industries, the second, tertiary industry power consumption and economic relations are most closely. Since 2007, the three major industrial structures are in constant adjustment, economic growth has been more dependent on energy consumption of light industry. At the same time, electricity consumption in heavy industries, which contributed the most to electricity consumption and accounted for about 80% of all industrial electricity, has fallen sharply since last year.　　Coupled with the impact of corporate inventory and other factors, the first quarter of this year, the above synchronization changes are not surprising. In addition, the data show that the GDP growth figures for the first quarter of this year are at least 2% lower than the current 6.1% per cent, given the price factor.　　In this view, the changes in GDP and electricity consumption data may not be that big gap. In addition to GDP, the amount of data associated with electricity consumption is added to the industrial value. The industrial operation of the previous year in April showed a low trend of stability, some areas and industries, the rapid decline in production has been initially curbed. Compared with the GDP, the use of electricity and industrial value added to the changes in the synchronization, indicating that electricity consumption data can still reflect the current economic trend to a considerable extent. Since the first quarter, the national electricity consumption is still negative year-on-year, but compared with last year's four-quarter decline of more than 7%, the decline has narrowed sharply, only 4.02%.　　The decline in electricity consumption in January-April and January-May was basically about 4% per cent, indicating that the reduction in electricity consumption had stabilized, and perhaps even a turning point. From the longitudinal ratio, excluding the spring Festival and the impact of snow and ice disasters in the first 2 months of data, the previous year in March, April, before May, China's electricity consumption data growth is still at a high level, respectively, 13.04%, 12.71% and 12.42%. In this year's domestic and foreign economic situation is not very clear background, the previous May data year-on-year decline in the range can still be stable at a certain level.　　According to analysts, the downward trend in electricity consumption has been steadily stopped and the macro-economy is bottoming out. Can be confirmed with the factory price of industrial products (PPI), this year in April, the index only fell 2.2%, the recovery process is relatively smooth. In May, China's manufacturing Purchasing Managers ' Index (PMI) was 53.1, a slight drop of 0 from last month..4%, it also clearly exceeded market expectations of around 50. Of course, the recovery still faces some uncertainties. In the first quarter of this year, net exports, the key driver of China's economic growth, have shifted to negative economic growth. Although 3 April China's exports have been continuously rising for two consecutive months, but year-on-year decline.　　Coupled with the negative impact of the swine flu pandemic, some leading indicators suggest that the outlook for export recovery remains uncertain. The current rapid rebound in investment, the impact on the quality of economic growth is also worth observing. In addition, from the current data, and GDP associated with large CPI data, the first half of the year will still be negative trend. This shows that the current domestic demand is still cold.　　Real estate prices remain high, but also inhibit the overall increase in domestic consumer demand. Overall, the economy can continue, steady recovery, in addition to observing the trend of electricity consumption, but also need to pay attention to foreign trade trends and domestic demand growth can be further supported.