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The Breakthrough of Physical Economy
——Dr. Wu Ge, Chief Economist, Changjiang Securities, Assistant to President

2023-03-28 10:25:19


Dr. Wu elaborated on the outlook for the economy in the post-pandemic era from the perspectives of consumption, real estate and finance.


First, recovery of consumption after the pandemic. Looking at China's economic situation from the perspective of residents' balance sheets: consumption "leaves traces" after the pandemic, consumption rises moderately and slowly, and it will take time to repair after damage. At the same time, Dr. Wu discussed whether high deposits could turn into high consumption, or it depends on residents’ expectations for the future.


Second, real estate is far from equilibrium. China's real estate is on the recovery channel, and there may be a temporary high point at the end of the second quarter. It will take a long time to release the backlog of demand for house purchasing. The current high interest rates on mortgages have led residents to tend to repay their loans in advance. The releasing inelastic demand for marriage after the pandemic may boost real estate sales. The risk of real estate enterprises has fallen back, but the risk of residents still needs to be dealt with, and then it will be repaired.


Third, financial performance after the pandemic. After the pandemic, the financial decline and the improvement of social financing will boost the economy little. Overseas financial risks are temporarily controllable, the pace of US dollar appreciation tends to be slower, and the depreciation of the RMB may slow down. Export growth is negative but tends to be stable, and there is the problem of post-pandemic price rise. After the optimization of epidemic prevention, China's economy may fall this year by going through two stages: a rebound period and a slowdown period.

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