Yao Jingyuan - Can't talk bottomless, moderately loose monetary policy can't be changed

Yao Jingyuan, chief economist of the National Bureau of Statistics, stated on the 26th that from the perspective of the first quarter, China’s economic declining trend has been initially contained and there have been positive signs. However, it still cannot bottom out and the economy is “V-shaped”. The trend is more likely. He believes that a moderately loose monetary policy cannot be reformed at present. “I expect that prices will be low this year, which will also create room for a moderately loose monetary policy.”

Shanghai Securities Journal reported on the 27th that Yao Jingyuan believes that from the perspective of various economic indicators in the first quarter, the performance of the Chinese economy is not as pessimistic as previously expected, the current trend of continued economic decline has been initially contained, and the country has adopted a package to deal with difficulties. The effect of the guidelines has begun to appear, and monthly indicators have also shown signs of positive economic growth.

Yao Jingyuan stated that from the perspectives of investment, consumption, and export, the investment growth rate in the first quarter reached 28.8%, which was a 4.2% increase year-on-year. Due to the year-on-year decline in investment product prices, this growth rate has a higher gold content. "If you reduce to a comparable price, the first-quarter investment will increase by more than 30% year-on-year." Yao Jingyuan said that in the first quarter, China's investment presents three main characteristics: First, infrastructure, especially high-speed growth in railway investment; second, large new projects The rate of increase; Third, the growth of investment in the central and western regions is faster.

Yao Jingyuan also believes that the growth rate of consumption in the first quarter is very rare, exceeding the previous expectation, especially in the automotive industry, which showed a significant year-on-year increase compared to the previous quarter, indicating that consumer confidence is still relatively abundant. On the export side, although it is still in negative growth year-on-year, he pointed out that from the month-on-month basis, the downward trend in exports is narrowing, which is also a positive signal.

Yao Jingyuan said that despite the signs of a turnaround in economic performance, it is still necessary to make efforts to turn signs into trends. "If the trend toward stability can stabilize, the possibility of the economy exhibiting a "V-shaped" is relatively large. The four months from November last year to February this year will be the most difficult period in this round of economic downturn." Yao Jingyuan said, Although there is little possibility that the economic trend will change from a "V-shape" to a "U-shape," there are two factors that must be taken into consideration: First, the recovery of the world economy. At present, it cannot be concluded that the world economy will emerge from this year's disaster. Second, the actual effect of domestic implementation of various measures.

He further mentioned that the issue of economic growth in China is not a big issue. The challenge lies in adjusting the economic structure. "If the mode of growth cannot be fundamentally resolved, then the economy will remain in a state of fluctuation."

When it comes to credit and inflation expectations, Yao Jingyuan stated that he does not advocate using "sustainability" to describe credit growth. In the first quarter, new loans of 4.58 trillion yuan will be gradually absorbed in the following quarters. "A moderately loose monetary policy cannot be reformed, but it must also maintain the continuity and stability of the policy." He said that he expects prices to remain low this year and will create room for moderately loose monetary policy.

In credit projection, Yao Jingyuan believes that at present, China's credit is not fully covered by small and medium-sized enterprises and private economy, and it is recommended to accelerate the speed of credit coverage. “If from the investment point of view, when private investment has increased substantially, We can confidently say that we have no problem in overcoming the crisis,” he said.