The blockbuster meeting that sets the direction of economic policy in 2019 has finally arrived!

The political Bureau of the CPC Central Committee held a meeting on December 13 to analyze and study the economic work in 2019. As an important meeting to determine the direction of economic policy in the coming year, the Politburo meeting held in December each year has attracted much attention from the outside world, while the Politburo meeting held at the end of October each year is regarded as the weather vane of the December meeting, and the two are closely related to the past and the future, both of which predict the direction of economic policy in the coming year.

Comparing this meeting of the Politburo with the meeting held at the end of October, we should pay attention to the following aspects:

1. Compared with the October meeting, the formulation of this meeting is relatively broad, and it does not mention the policy direction in specific areas such as reforming the capital market, solving the difficulties in the development of private enterprises, and making effective use of foreign capital, as the October meeting did. Even the expressions of fixed-tone fiscal policy and monetary policy often mentioned at the meetings of the political Bureau in the past were not mentioned.However, this meeting also did not mention the relevant policies in the real estate field, but once again mentioned the "six stability".

2. Unlike the October meeting, this meetingIt is once again mentioned to do a good job in the three major battles, with emphasis on steady growth, keeping the economy running within a reasonable range, and maintaining sustained and healthy economic development and overall social stability.It also indicates that next year's economic policy will focus on stabilizing economic growth.

3. After the October meeting proposed that "profound changes have taken place in the external environment", the meeting stressed the need to "dialectically look at the changes in the international environment and domestic conditions, enhance the awareness of suffering, unswervingly run our own affairs, and maintain strategic stability."This may imply that the starting point of next year's policy will be mainly to deal with changes in the domestic environment, but also stressed that the established macro policy direction will not be changed due to changes in the external environment.

4. The focus of this meeting isSeven key macroeconomic policy areas have been identified for next year.It covers continuing to fight the three key battles, promoting the high-quality development of the manufacturing industry, promoting the formation of a strong domestic market, promoting the strategy of rural revitalization, promoting coordinated regional development, promoting all-round opening up to the outside world, strengthening security and improving people's livelihood.

In addition, today's meeting also listened to the work report of the Central Commission for discipline Inspection and studied and deployed the work of building a clean and honest party style and a clean government and anti-corruption work in 2019. The meeting stressed that the situation in the struggle against corruption is still grim and complicated, and there is still a long way to go to administer the party strictly in an all-round way, and we must adhere to the word "strict" for a long time and pay close attention to the problems of not being in awe, not caring about, shouting slogans, and pretending, and resolutely eliminate formalism and bureaucracy. It is necessary to effectively reduce the stock, effectively contain the increment, consolidate and develop the overwhelming victory in the struggle against corruption, and rectify the problems of corruption and work style around the masses.

Interpretation one: this is the evaluation of this year's economic work.

The meeting summarized this year's economic work and looked forward to the economic situation in 2019.

The meeting held that since the beginning of this year, in the face of the complex international environment and arduous tasks of domestic reform, development and stability, we have adhered to the general tone of making progress in the midst of stability, implemented the requirements of high-quality development, and effectively responded to profound changes in the external environment. We have worked in a down-to-earth manner, the reform and opening up has continued to deepen, various macro-control objectives can be well achieved, the three major battles have made a good start, and supply-side structural reform has been deepened. The people have gained more tangible benefits, maintained sustained and healthy economic development and overall social stability, and made new steps towards achieving the first centenary goal.

Looking ahead to next year, 2019 will be a crucial year. As early as the meeting of the Politburo in October, it made a judgment on the changes in the economic situation for a period of time in the future, expressed that major changes had taken place compared with the previous period of time, and put forward that "the economic operation has changed steadily, the downward pressure on the economy has increased, and the hidden dangers accumulated over a long period of time have been exposed."

But even as the downward pressure on the economy increases, the meeting's goals for 2019 remain high. The meeting pointed out that 2019 is the 70th anniversary of the founding of New China and the key year to win the first centenary goal of building a moderately prosperous society in an all-round way. Therefore, it is necessary to "celebrate the 70th anniversary of the founding of the people's Republic of China with outstanding achievements."

Interpretation 2: next year, the policy will focus on stabilizing growth and resolving domestic contradictions.

How can we "celebrate the 70th anniversary of the founding of the people's Republic of China with outstanding achievements"? The meeting made arrangements and set the tone for the direction of economic policy next year. Among them, some statements are similar to those of the October meeting, such as "adhere to the general tone of the work of seeking progress in the midst of stability, adhere to the new concept of development, and promote high-quality development." adhere to the supply-side structural reform as the main line "," further stabilize employment, finance, foreign trade, foreign investment, investment, expectations, and so on.

However, there are still some new expressions at this meeting:

On the one hand, in the face of increasing downward pressure on the economy, the meeting stressed the need for steady economic growth next year. The meeting pointed out that overall efforts should be made to promote stable growth, promote reform, adjust the structure, benefit the people's livelihood and prevent risks, keep the economy running within a reasonable range, and maintain sustained and healthy economic development and overall social stability.

On the other hand, judging from the statement of this meeting, apart from stabilizing growth, another major focus of economic policy next year is to focus on resolving domestic contradictions, mainly to deal with changes in the domestic environment, and the established macro policy direction will not change as a result of changes in the external environment.

For example, the meeting stressed the need to take a dialectical view of the changes in the international environment and domestic conditions, enhance the awareness of hardship, and unswervingly handle their own affairs. It is necessary to maintain strategic concentration, pay attention to steady and steady efforts, strengthen coordination and cooperation, focus on principal contradictions, grasp the rhythm and intensity, and strive to achieve the best policy combination and the maximum overall effect.

Interpretation 3: next year, economic policy will focus on these seven aspects.

After determining the general tone of stable economic growth and focusing on principal contradictions and maintaining strategic stability, the key areas of economic policy next year will also follow. It is worth noting that this meeting mentioned a total of seven policy areas to be promoted next year:

1. Continue to do a good job in the three major battles and, in accordance with the established action plan, do a good job in key battles in view of outstanding problems.

2. Promote the high-quality development of the manufacturing industry and promote the deep integration of advanced manufacturing and modern service industries.

3. Promote the formation of a strong domestic market and enhance the overall level of the national economy.

4. Firmly promote the strategy of rural revitalization and consolidate and develop the "agriculture, rural areas and farmers" and continue to improve the situation.

5. Promote regional coordinated development and give full play to the comparative advantages of various regions.

6. speed up the reform of the economic system and promote all-round opening up to the outside world.

7. Strengthen the protection and improvement of people's livelihood, and strive to solve the outstanding problems strongly reflected by the people.

Yang Zaiping, secretary general of the Asian Financial Cooperation Association, pointed out: at present, the international situation has changed abruptly, and the domestic economic situation has also changed steadily. In order to seek economic development, China must take short-term measures to meet urgent needs, but it also needs a long-term strategy.

The so-called short-term response measures are like the "six stability" emphasized by the Politburo meeting many times. However, Yang Zaiping also stressed that the most important thing is to stabilize confidence. China is indeed facing a grim situation in the short term, especially the current international environment is disadvantageous to us, but in the face of short-term pressure, we should see that the fundamentals of China's long-term improvement have not changed.

"40 years after China's reform and opening up, China's per capita GDP has exceeded 8000 US dollars, which, according to the definition of the World Bank, belongs to the upper-middle level. A large country with a population of 1.4 billion can achieve such a per capita GDP level, indicating that China has a huge domestic market. "Yang Zaiping said.

Therefore, Yang Zaiping suggested that in terms of the response to the long-term strategy, we need to start from the following aspects:

One is to turn to the main domestic market.

The second is to focus on domestic industrial upgrading.

The third is to accelerate the original scientific and technological research and development.

The fourth is to cultivate and strengthen the entrepreneur class and encourage entrepreneurs to innovate.

The fifth is to improve the education system and train our own talents so as to further improve the quality of the people.

Sixth, adhere to the direction of market-oriented reform.

Seventh, open wider to the outside world.

Eighth, take the initiative to integrate with international rules.

Ninth, there should be more maneuvering strategies in the international arena, and there are no permanent friends in the international diplomatic arena, only permanent interests, looking for the intersection of interests, and striving for as many international forces as possible will contribute to our development.

Interpretation 4: fiscal and real estate policies are expected to be adjusted next year

Recent economic and financial data show that the current downward pressure on the economy is further increasing. Therefore, in order to ensure stable economic growth next year, many analysts believe that fiscal and real estate policies are expected to be adjusted next year, fiscal policy will continue to support the economy, and real estate regulation and control may usher in marginal relaxation.

Guotai Junan (16.53 + 1.10%, diagnosis stock) securities macro team believes that the increasing downward pressure on the economy, coupled with the low growth rate of fiscal revenue in the first half of this year, is expected to show a trend of high before and low after 2019. Both the deficit ratio and the amount of special debt are expected to be raised in 2019. Future infrastructure should focus on large-scale PPP projects and areas with good economic benefits, especially in key national planning areas, such as Xiongan, Guangdong, Hong Kong and Macao. It is expected that rural revitalization will also usher in a substantial promotion in 2019, PSL or docking.

Guotai Junan Securities Macro team said that the Politburo meeting in October did not mention real estate regulation and control, in fact, laid the groundwork for the next real estate relaxation. When the downward pressure on the economy further increases, real estate relaxes or starts with ensuring rigid demand and improving demand. In order to meet the credit issuance target, some commercial banks have begun to cut the interest rate of the first home loan. Although in order to prevent the high leverage of residents, the policy of purchase, loan and price restriction is not expected to be relaxed directly. However, if we appropriately relax the policy of both housing recognition and loan recognition, and increase financing support for real estate enterprises, the role of real estate in stabilizing growth can be expected.

Liang Hong, chief economist of China International Capital Corporation, also believes that current fiscal and real estate policies urgently need to be adjusted to promote broad credit expansion, thereby boosting aggregate demand. Given the further downward pressure on nominal growth and corporate earnings, the possibility of negative M1 growth in the first half of 2019 cannot be ruled out if the policy is not adjusted decisively, which means there may be downward pressure on inflation expectations and monetary velocity. The November monetary and credit data highlight that policy coordination needs to be further improved to effectively boost the credit cycle.

Given that the decline in corporate earnings growth will continue to dampen loan demand, there is an urgent need to speed up government bond issuance and, more importantly, to adjust overly tight property demand and developer financing policies as soon as possible. "said Liang Hong.

Ming Ming, deputy director of CITIC Research Institute, said that this meeting of the Politburo sent a stronger sense of hardship and a signal of economic stability next year, and the willingness to support the policy of easing in the future will continue. The path of stable growth is also very important, specifically divided into three types, the first is to relax real estate, the second is to increase infrastructure, and the third is to reduce taxes. In fact, there are certain contradictions in these three paths, such as tax reduction will inevitably lead to revenue tax reduction to curb infrastructure, such as whether loose real estate should cooperate with the introduction of property tax, then it will offset the effect of tax reduction to a certain extent. We believe that from the perspective of policy urgency, stable infrastructure is the best choice, and stable infrastructure needs to solve government debt, so it requires monetary easing to increase, then there is still room for market interest rates to go down, but in the short term, the bond market is crowded, expectations are too consistent, and there is the possibility of adjustment; at the same time, the expectation of infrastructure improvement will also support the stock market.