The bottom of the economic growth stabilization is still uncertain

In the August, the improvement of economic demand was concentrated on domestic demand. The external demand performance was not as bad as the market had expected.　　China's economy has been able to show signs of stabilisation, essentially related to China's "consumption upgrade + regional upgrading + industrial upgrading" of the economic growth cycle. China's economic growth in the two quarter after the rapid decline, the August has been a sign of stability, especially domestic demand growth has been better, and the representation of the economic supply side of the industrial production also in the early days of the enterprise inventory after the initial recovery of the symptoms. This does not necessarily mean that the bottom of the economy has arrived, but at least it shows that the government-controlled economic downturn will be more modest.　　Even considering that the slowdown in the second half of the year will still pose some pressure on the economic downturn, but given the gradual controllability of slowing external demand, this round of economic decline will be relatively limited, GDP growth rate of more than 8% will be a big probability event, which will be the upgrade of China's economy, usher in a new round of economic growth cycle of prosperity to create a better environment.　　Increasing domestic demand and promoting economic stability in the August, the improvement of economic demand is mainly reflected in domestic demand. Government-controlled investment growth has shown signs of stabilisation in the first half of the year: 1-August, the town's fixed-asset investment of 14.0998 trillion yuan, although year-on-year growth of 24.8%, than 1-July fell 0.1%, but if the August one-month comparison, investment growth has reached 23.9%, significantly faster than last month 22.3%　　Growth. This and since August, the central government in order to curb the second half of the economic downturn, the initiative to increase the implementation of the 4 trillion projects related to investment, January-August, the central project investment 1.12 trillion yuan, an increase of 11.4%, compared with the cumulative increase of 1% last month.　　In addition, the stability of real estate investment growth to a greater extent to ensure a stable investment growth in August, such as the January-August real estate development investment of 2.8355 trillion yuan, an increase of 37%, although the increase is slightly 0.5% slower than January-July, but from a single month, the investment rose 31%, faster than the July growth rate of 3%. From the next few months, conducive to investment to maintain a steady increase in the factors also: the current development and Reform Commission and other departments are actively urged to accelerate the construction of 4 trillion of investment projects around the world to ensure that the project has been issued investment plans in the Central Inspection Unit before the fall of the start construction, which will help to ensure investment growth in advance　　The total investment of the newly-started project has maintained steady growth. Consumption, August growth has a better performance: August, the total retail sales of consumer goods 1.257 trillion yuan, an increase of 18.4%, faster than July 0.5%. The main reason for the acceleration of consumption is the increase of consumption of related consumption and upgrade products. such as communications from the last month's 11.2% rebound to the August 21.%, and benefited from August real estate sales rebound, such as August home sales growth rate of 9%, furniture category of goods growth, from July 35.9% rose to August 40.4% , automobile commodity consumption growth rate is also more prominent, in order toIn the off-season of August, growth was at 35.2%, up 6.6% from last month's growth. External demand performance is not as bad as market expectations, such as August exports amounted to 139.3 billion U.S. dollars, compared with the July quarter of the Quarter-on-quarter only 1.4% decline, the year-on-year growth of 34.4%, the growth rate was only 3.7% lower than last month.　　And in the coming months, given that the likelihood of a deep recession in the world economy remains small, the decline in export growth is still manageable and moderate, and its negative impact on the economy will be largely hedged by a steady pick-up in domestic demand growth. And the steady growth of demand surface is undoubtedly beneficial to the enterprise to inventory and industrial production improvement, if after a few months of rapid inventory, industrial enterprise inventory has come down to a more reasonable level, August PMI Production Inventory index of 46.9%, while some of the lower inventory level of enterprises in the face of increased demand, Has begun to expand production, driven by increased car sales, and the growth in transport equipment manufacturing, which has rebounded from 15.9% in July to 16.6% in August, which has led to a modest rebound in August, up 13.9% per cent year-on-year, after a rapid decline in the past few months.　　0.5% faster than July.　　Upgrade drives China's economy we believe that the Chinese economy has been able to show signs of stability, ostensibly with the government recently relaxed investment control, but in essence with China is in the "Consumption upgrade + regional upgrading + industrial upgrading" of the economic growth cycle. In terms of consumption escalation, with more regional GDP exceeding 3000 U.S. dollars per capita, such as 2008 years of GDP across the threshold of consumption escalation-3000 U.S. dollars per capita, only 12 provinces, 2009 to 18, 2010 is expected to reach 21, China has ushered in the era of mass consumption,　　Especially with the consumption of the upgrading of durable goods consumption will usher in rapid growth period, such as automobiles. In the area of regional upgrading, the eastern region after the completion of the industrialization of the medium-term, subject to resource constraints, has begun to pursue more regional growth of new impetus to improve the quality of economic growth, such as Shanghai to build a global financial center, the Pearl River Delta region in the context of the high economic development of regional　　, and the vast Midwest region industrialization, the space of urbanization is still very large, and they are eager to carry out the economic catching-up strategy by "weather"--all kinds of regional planning, "geographical location"--a Better energy foundation and more and more perfect infrastructure, "people and"-abundant labor resources. Driven by regional upgrades and consumer upgrades, all over the industrial upgrading is also in full swing, the current regional upgrade will be driven by two aspects of industrial upgrading, such as the region in the better implementation of economic and administrative areas of integration, in accordance with the industrial revitalization of the planning to co-ordinate the advantages of industry, the formation of industrial clusters, industrial upgrading will be a logical , such as the eastern region of the economy in the completion of high-end positioning process, many no longer have the advantage of the resources of the industry to transfer to the Chinese and Western, so as to accelerate the industrialization of the Midwest, urbanization process, and promote the formation of industrial upgrading as soon as possible. It still takes time to form the bottom of the economy because the Chinese economy is going through these three major upgrades, so government regulation since the end of last year will not have a big negative impact on China's economic growth, and in the longer term, the aim of this regulation is also to lay a healthier economic and institutional foundation for the promotion. such as local financing platform rectification, real estate control and so on. Thus, the growth of the new round of economic cycles that has risen since 2009 will be temporary, when the rebound will depend more on the government's intentions, the government to control the target is basically in place, such as "Eleven-Five" energy-saving emission reduction targets are basically completed, four-quarter inflation significantly fell back, real estate prices have fallen and the housing construction has begun to bear fruit, After the reorganization of local financing platform, a new round of China's economic recovery, driven by "regional upgrading, industrial upgrading and consumption escalation", inspired by the policy, especially the Twelve-Five plan, will not have a substantial recovery, and the economic bottom is still a long way off. (Author Unit: National securities)