According to the financial data released last Friday, the decline in M1 in November narrowed by 2.4 percentage points to 3.7%, while M2 growth fell by 0.4 percentage points to 7.1%, benefiting from the recovery in capital market performance, and the degree of funding activation clearly rebounded under the wealth effect. The scissors difference between M2 and M1 has significantly narrowed. From the data in October, the year-on-year growth rate of M1 balance saw its first improvement this year, with a decrease of 1.3 percentage points compared to September, reaching -6.1%. Following the initial improvement in M2 growth, M0 and M1 growth have also rebounded. Historically, M1 has had a significant influence in the equity market. The market believes that 'M1 determines buying and selling' because M1 once represented corporate demand deposits and the operational vitality of enterprises. During the bull market that began in 2005, the significance of M1 as an indicator was very strong. The central bank's inclusion of more residents' demand deposits in M1 also aims to ensure that M1 adequately represents the operational vitality of the real sector. (Brokerage China)