The radical tightening policy has increased the risk of decline in the United States and Europe

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As the world's second largest economy

China's economic and market stable performance

It will play a "cockpit stone" role in the Asian and even global markets

Bring a ray of sunshine for the dim global economic prospects

Figure/Figure insect creativity

The "recession trading" of overseas markets was at the time. As of early July this year, the crude oil prices of the "King of Commodities" and the "Dr. Bronze", international soybeans, corn and wheat "three brothers" have all declined by more than 20 %, the price of commodity commodities Cooling highlights the need for concern. The heating of the US bond market implies that the economic recession is expected to rise, and the yield of 10 -year US bonds has fallen from 3.5 % in mid -June to 2.8 %. The 10 -year and 2 -year US debt yields have been "inverted" since April this April this year. This time, the "recession trading" characteristics have become more obvious during the downward period of US debt interest rates. The decline in the European market is expected to be more strong. As of July 5th, the German DAX and Italian ITLMS indexes have been adjusted by more than 15 %.

The downward signal of the United States and Europe has become stronger. In terms of consumption, the growth rate of personal consumption expenditure in the United States for the first time in the past six months was lower than the growth rate of income. In terms of investment, the construction expenditure in the United States in May was the first negative growth in the past year. Since July, the U.S. Federal Reserve model predicted that the US economy may shrink in the second quarter in a row this year, and the word "recession" will be displayed in front of the market. Some leading economic prosperity and confidence indicators have also continued to write downward economic trends.

The Radio tightening policy of the Bank of the United States and the European Bank increased the risk of recession. Since June, the Bank of the United States and Europe has made the most "eagle" statement during the year, which has exacerbated the market's concerns about the "hard landing" of the economy. The currency tightening effect on inflation is not immediate, and the tough attitude of the central bank has stirred up in the financial market. The return on short -term US debt in the United States and Europe has renewed high since the renewal of the subprime mortgage crisis in June. Breaking 0, the US 30 -year mortgage interest rate has reached the highest level since the end of 2008.

The decline expectations may make the risk of financial fluctuations even more layer. Throughout history, the financial crisis is often one step ahead of the economic crisis, which may not be accidental. The weakening of economic expectations increases the risk of fluctuations in the financial market. Because the market is prone to pessimism during the process of asset pricing, it may give birth to more extreme trading behaviors. In fact, since June, the overseas financial market has continued: European side, due to the sharp deterioration of the inflation situation, the European Central Bank has accelerated its withdrawal policy support, the contradiction between currency tightening and fiscal easing or threatening the sustainability of the debt of the euro zone. In mid -June, the 10 -year Italian government bond interest rate exceeded 4 % of the "warning line", and the new round of "European debt crisis" was beginning to appear. In Japan, the rapid depreciation of the yen since this year, as well as the dilemma of inflation and foreign trade deficit, has caused the market to suspect the sustainability of the Bank of Japan's loose policy. mechanism. At present, the European debt and the daily debt market will be temporarily calm, but these storms still ring the alarm for us.

But how the "recession trading" interprets three uncertainty. First, whether the market will underestimate the toughness of the economy. The latest announcement of 372,000 new non -agricultural employment in the United States in June, the number of people before the new crown epidemic was only about 200,000 people. The tight employment market hinted that there was still a distance between the economy and the recession. In addition, there is a self -regulation mechanism for economic operations. If the price of commodities is substantially declined, the investment and consumer demand that is suppressed by inflation in the early stage is expected to be repaired to a certain extent.

Second, whether the market will underestimate the vulnerability of the supply. Since the end of June, the current delivery price of the US WTI crude oil ship is significantly higher than the futures price, highlighting the "separated ways" of the terminal supply and demand pattern and market expectations. As of the end of June, US crude oil inventory was still about 10 % lower than the inventory level of oil prices in 2014. In the next few months, the demand for crude oil may not have fallen sharply, and supply may be difficult to repair. Moreover, the output of OPEC members represented by Libya's output, the strike of Norwegian oil workers, and the suspension of the supply of oil supply in the Lihai Pipeline Alliance are still staged in turn.

Third, whether the market will underestimate the flexibility of policies. Adjustment of commodity prices may usher in breathing pressure on overseas inflation. Based on the strong correlation of oil prices and US inflation (CPI) since 2000, in the second half of this year, oil prices decreased by $ 10/barrel, and the US CPI may decrease by about 0.4 percentage points year -on -year. In addition, recent inflation expectations have changed positive. For example, the 10 -year TIPS TIPS Treasury bond implied inflation is expected to fall to 2.3 % in early July, the lowest level in the past nine months. If the inflation situation improves, monetary policy may pay more attention to the risk of economic downturn and financial instability, and then choose to "step on the brakes" at the appropriate time and try to achieve the economic "soft landing".

Compared with overseas markets, RMB assets have gone out of the trend. Since the new crown epidemic, the US -Europe economy seems to have relied on currency and fiscal stimuli, which has caused inflation results to a certain extent. In contrast, strong epidemic prevention measures are supplemented by moderate counter -cyclical regulation, achieving economic recovery after the epidemic. In the first half of this year, the economic and currency cycle at home and abroad was "dislocated", which caused the RMB asset price to undergo pressure. Looking forward to the second half of the year, the downward risk of overseas economy is one step closer, and the current economic recovery of China's economic recovery needs to be released. Therefore, in the "economic dislocation" of recovery and overseas decline in China, in June this year, RMB assets were not afraid of fluctuations in the "independent market", and more than 70 billion yuan in the north of the month flowed into the Chinese stock market. As the world's second largest economy, the stable performance of China's economy and market will play a "cockpit stone" role in the Asian and even global markets, bringing a ray of sunlight to the dim global economic prospects. (The author is the chief economist of Ping An Securities)

Send 2022.7.18 Total Issue 1052 "China News Weekly" magazine

Magazine title: A radical tightening policy increases the risk of decline in the United States and Europe

Author: Zhong Zhengsheng

Capture: Wang Lin

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