Read in Chinese
Speaker:
Mr. Fu Linghui, spokesperson of the National Bureau of Statistics (NBS) and head of the Department of Comprehensive Statistics of the NBS
Chairperson:
Ms. Shou Xiaoli, director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO
Date:
Nov. 15, 2024
Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). This is a regular briefing on China's economic data. Today, we are joined by Mr. Fu Linghui, spokesperson of the National Bureau of Statistics (NBS) and head of the Department of Comprehensive Statistics of the NBS. Mr. Fu will brief you on China's economic performance in October 2024 and then take your questions.
Now, I'll give the floor to Mr. Fu for his introduction.
Fu Linghui:
Friends from the media, good morning. It's my pleasure to attend today's press conference organized by the SCIO. As usual, I will start by briefing you on the main economic indicators for this October and then take your questions.
In October, economic performance maintained steady growth and major economic indicators showed a significant rebound. In October, under the strong leadership of the Central Committee of the Communist Party of China (CPC) with Comrade Xi Jinping at its core, all regions and departments strictly implemented the decisions and arrangements of the CPC Central Committee and the State Council, adhered to the general principle of pursuing progress while ensuring stability, and fully and faithfully applied the new development philosophy on all fronts. With the synergy created by the existing policies and incremental policies unfolding, major economic indicators of consumption, services and imports and exports recovered markedly, employment and prices were basically stable, social expectations continued to improve, high-quality development witnessed solid progress, and positive factors were accumulated. The national economy registered steady progress and recovery.
First, industrial production increased steadily and equipment manufacturing and high-tech manufacturing grew quickly.
In October, the total value added of industrial enterprises above designated size grew by 5.3% year on year, 0.1 percentage point lower than that of September, or up by 0.41% month on month. In terms of sectors, the value added of mining went up by 4.6% year on year, that of manufacturing was up by 5.4%, and that of the production and supply of electricity, thermal power, gas and water was up by 5.4%. The value added of equipment manufacturing went up by 6.6% year on year, and that of high-tech manufacturing was up by 9.4%, which were 1.3 percentage points and 4.1 percentage points faster than the total value added of industrial enterprises above designated size. In terms of ownership, the value added of state holding enterprises went up by 3.8% year on year; that of share-holding enterprises was up by 5.9%; that of enterprises funded by foreign investors or investors from Hong Kong, Macao and Taiwan was up by 2.9%; and that of private enterprises was up by 4.8%. In terms of products, the production of new-energy vehicles, industrial robots and integrated circuits grew by 48.6%, 33.4% and 11.8%, respectively. In the first 10 months, the total value added of industrial enterprises above designated size grew by 5.8% year on year, the same as that in the first nine months. In October, the Manufacturing Purchasing Managers' Index was 50.1%, 0.3 percentage point higher than that of September; and the Production and Operation Expectation Index was 54.0%, up by 2.0 percentage points. In the first nine months, the total profits of industrial enterprises above designated size were 5,228.2 billion yuan, down by 3.5% year on year.
Second, the service sector accelerated notably and the modern services sector developed well.
In October, the Index of Services Production grew by 6.3% year on year, 1.2 percentage points higher than that of September. Specifically, that of financial intermediation grew by 10.2%, that of information transmission, software and information technology services was up by 9.5% and that of leasing and business services was up by 8.8% year on year, which were 3.9 percentage points, 3.2 percentage points and 2.5 percentage points faster than the Index of Services Production, respectively. In the first 10 months, the Index of Services Production increased by 5.0% year on year, which was 0.1 percentage point faster than that of the first nine months. In the first nine months, the business revenue of service enterprises above designated size grew by 7.2% year on year. In October, the Business Activity Index for Services was 50.1%, 0.2 percentage point higher than that of September. The Business Activity Expectation Index for Services was 56.2%, up by 1.6 percentage points. Specifically, the Business Activity Index for railway transportation, water transportation, air transportation, postal services, capital market services, ecological protection and public facilities management stayed within the high expansion range of 55.0% and above.
Third, market sales recovered rapidly and sales of new goods under the trade-in program accelerated.
In October, the total retail sales of consumer goods was 4,539.6 billion yuan, up by 4.8% year on year, 1.6 percentage points faster than that of September; or up by 0.41% month on month. In terms of different areas, the retail sales of consumer goods in urban areas were 3,925.5 billion yuan, up by 4.7% year on year; and in rural areas were 614.1 billion yuan, up by 4.9%. Grouped by types of consumption, the retail sales of goods were 4,044.4 billion yuan, up by 5.0%; and the income of catering was 495.2 billion yuan, up by 3.2%. Upgraded goods sold well. The retail sales of cosmetics and of sports and recreational items by enterprises above designated size grew by 40.1% and 26.7%, respectively. Driven by the consumer goods trade-in programs, the retail sales of household appliances and audio-video equipment, cultural and office supplies, furniture, and automobiles by enterprises above designated size went up by 39.2%, 18.0%, 7.4% and 3.7% respectively, which were 18.7 percentage points, 8.0 percentage points, 7.0 percentage points and 3.3 percentage points higher than that of September, respectively. In the first 10 months, the total retail sales of consumer goods were 39,896.0 billion yuan, up by 3.5% year on year, 0.2 percentage point faster than that of the first nine months. Online retail sales were 12,363.2 billion yuan, up by 8.8% year on year. Specifically, the online retail sales of physical goods were 10,333.0 billion yuan, up by 8.3%, accounting for 25.9% of the total retail sales of consumer goods. In the first 10 months, the retail sales of services grew by 6.5% year on year.
Fourth, investment in fixed assets increased steadily and investment in high-tech industries grew quickly.
In the first 10 months, investment in fixed assets (excluding rural households) reached 42,322.2 billion yuan, up by 3.4% year on year, which was the same as that of the first nine months. Investment in fixed assets was up by 7.6% with investment in real estate development deducted. Specifically, investment in infrastructure grew by 4.3% year on year, that in manufacturing grew by 9.3%, and that in real estate development declined by 10.3%. The floor space of newly-built commercial buildings sold was 779.30 million square meters, down by 15.8% year on year, 1.3 percentage points lower compared with that of the first nine months; the total sales of newly-built commercial buildings were 7,685.5 billion yuan, down by 20.9%, 1.8 percentage points lower. By industry, investment in the primary industry went up by 2.5% year on year, that in the secondary industry up by 12.2%, and that in the tertiary industry down by 0.9%. Private investment declined by 0.3% year on year, and increased by 6.3% with investment in real estate development deducted. Investment in high-tech industries grew by 9.3% year on year, of which investment in high-tech manufacturing and high-tech services grew by 8.8% and 10.6%, respectively. In terms of high-tech manufacturing, investment in manufacturing of aerospace vehicle and equipment and in manufacturing of electronic and communication equipment grew by 34.5% and 9.4%, respectively. In terms of high-tech services, investment in professional technical services and in e-commerce services grew by 32.0% and 16.3%, respectively. In October, investment in fixed assets (excluding rural households) increased by 0.16% month on month.
Fifth, imports and exports of goods grew quickly and trade structure continued to improve.
In October, the total value of imports and exports of goods was 3,700.7 billion yuan, up by 4.6% year on year, 3.9 percentage points faster than that of September. The value of exports was 2,189.9 billion yuan, up by 11.2%, and the value of imports was 1,510.8 billion yuan, down by 3.7%. In the first 10 months, the total value of imports and exports of goods was 36,021.9 billion yuan, up by 5.2% year on year. The value of exports was 20,802.8 billion yuan, up by 6.7%, and the value of imports was 15,219.1 billion yuan, up by 3.2%. In the first 10 months, the imports and exports in general trade went up by 3.9%, accounting for 64.1% of the total value of imports and exports. Imports and exports by private enterprises went up by 9.3%, accounting for 55.1% of the total value of imports and exports, 2.1 percentage points higher than that of the same period last year. Exports of mechanical and electrical products went up by 8.5%, accounting for 59.4% of the total value of exports.
Sixth, employment was generally stable and the surveyed urban unemployment rate declined.
In the first 10 months, the surveyed urban unemployment rate averaged 5.1%, which was 0.2 percentage point lower than that of the same period last year. In October, the surveyed urban unemployment rate was 5.0%, which was 0.1 percentage point lower than that of September. The surveyed unemployment rate of population with local household registration was 5.1% and that of population with non-local household registration was 4.8%, among which, the rate of the population with non-local agricultural household registration was 4.7%. The surveyed urban unemployment rate in 31 major cities was 5.0%, which was 0.1 percentage point lower than that of September. The employees of enterprises worked an average of 48.6 hours per week.
Seventh, consumer prices increased slightly and producer prices for industrial products declined year on year.
In October, the consumer price index (CPI) went up by 0.3% year on year, 0.1 percentage point lower than that of September; or down by 0.3% month on month. Grouped by commodity categories, prices for food, tobacco and alcohol went up by 2.0% year on year; clothing was up by 1.1%; housing was down by 0.1%; articles and services for daily use was up by 0.1%; transportation and communication was down by 4.8%; education, culture and entertainment was up by 0.8%; medical services and health care was up by 1.1%; and other articles and services was up by 4.7%. Among the prices for food, tobacco and alcohol, the price of grain went down by 0.7%, fresh fruits was up by 4.7%, pork was up by 14.2% and fresh vegetables was up by 21.6%. The core CPI excluding the prices of food and energy went up by 0.2% year on year, 0.1 percentage point higher than that of September. In the first 10 months, the CPI went up by 0.3% year on year.
In October, the producer prices for industrial products went down by 2.9% year on year, or down by 0.1% month on month, and the purchasing prices for industrial producers went down by 2.7% year on year, or down by 0.3% month on month. In the first 10 months, the producer prices and the purchasing prices for industrial products both dropped by 2.1% compared with the same period last year.
Generally speaking, with the accelerated implementation of the existing policies and the introduction of a raft of incremental policies in October, the national economy showed stable growth trend with major indicators recovering notably and positive factors accumulated. However, we should be aware that the external environment is increasingly complicated and severe, effective domestic demand is still weak and the foundation for continuous economic recovery needs to be strengthened. At the next stage, we must follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, fully implement the guiding principles of the 20th CPC National Congress and the second and third plenary sessions of the 20th CPC Central Committee, adhere to the principle of pursuing progress while ensuring stability, and fully and faithfully apply the new development philosophy on all fronts. We must take solid steps to advance high-quality development, accelerate efforts to create a new pattern of development, and redouble efforts to implement the raft of incremental policies, so as to consolidate and enhance the momentum for economic recovery and growth and achieve the annual economic and social development targets. Thank you.
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Shou Xiaoli:
The floor is now open to questions. Please identify the media outlet you represent before asking your questions. Please raise your hand when asking your questions.
The Paper.cn:
China's economic performance has been generally stable since the beginning of this year, but, due to the complex and changing domestic and international environment, there have also been difficulties and challenges. How do you evaluate October's economic performance? What are the highlights and positive changes? Thank you.
Fu Linghui:
Thank you for your questions. Everyone is paying close attention to economic performance in October. Since the beginning of this year, the international situation has been complex and severe. Global economic recovery has eased up and the monetary policies of major economies have in turn entered the cycle of interest rate cuts. Meanwhile, the intertwining of trade protectionism, unilateralism and geopolitical conflicts has increased the uncertainty with the operation of the world economy. Domestically, the Chinese economy is in a critical period of structural adjustment and transformation. The transition between traditional and emerging growth drivers has been accelerated, and more difficulties and challenges that development faces have emerged. In response to these difficulties and challenges, the CPC Central Committee has made scientific decisions and has strengthened macroeconomic regulation and control. Especially after the meeting of the Political Bureau of the CPC Central Committee on Sept. 26, relevant departments have intensified efforts to introduce a package of incremental policies, resulting in an enhanced rebound with economic performance and key indicators as well as improving market confidence. Main indicators in October showed a trend of "three rebounds, two stables and one boost."
"Three rebounds" refer to notable rebounds in market sales, within the service sector and with imports and exports. In terms of market sales, driven by the trade-in policy for consumer goods, total retail sales of consumer goods in October increased by 4.8% year on year, up 1.6 percentage points compared with the previous month. Specifically, retail sales of goods increased by 5% year on year, up 1.7 percentage points compared with the previous month. The retail sales of services continues to show strong momentum, with a 6.5% year-on-year increase for the first ten months, outpacing the growth of retail sales of goods. In terms of the service sector, it has demonstrated a noticeable recovery trend. In October, the index of services production grew by 6.3% year on year, accelerating by 1.2 percentage points from the previous month and marking two consecutive months of increased growth. This represents the highest growth rate for the index so far this year. Driven by incremental policies, significant recoveries were observed in the indexes of production of the financial sector, real estate industry and the wholesale and retail sectors, with those of the wholesale and retail sectors improving by 2 percentage points, and those of the financial and real estate sectors increasing by more than 3 percentage points and 3 percentage points, respectively. From an import and export perspective, despite a slowdown in global trade growth, China's goods trade competitiveness continues to emerge. In October, the total volume of import and export goods increased by 4.6% year on year, accelerating by 3.9 percentage points from the previous month. Exports grew by 11.2%, accelerating by 9.6 percentage points.
"Two stables" refer to the stable growth of industry and investment as well as the stability of employment and pricing. Industry and investment are crucial to support economic development. In October, both industry and investment maintained stable growth, playing an important role in the steady progress of economic performance. In terms of industry, driven by factors such as large-scale equipment renewal and industrial upgrading, the added value of industrial enterprises above designated size increased by 5.3% year on year in October, maintaining rapid growth. Among them, the upgrading trend of manufacturing was obvious. Notably, high-tech manufacturing grew by 9.4% year on year, significantly outpacing the overall growth of industrial enterprises above designated size. In terms of investment, investment in key sectors has shown good growth momentum and has played a strong supporting role. From January to October, fixed asset investment increased by 3.4% year on year, maintaining a growth rate of 3.4% for three consecutive months, which indicates increased stability in investment growth. Investment in manufacturing grew by 9.3%, increasing slightly by 0.1 percentage point compared to the first nine months. Particularly, investment in high-tech manufacturing has grown rapidly, which will effectively promote industrial upgrading.
Employment and price stability have an important impact on the stable functioning of the economy. Regarding employment, the surveyed urban unemployment rate in October was 5%, down 0.1 percentage point from the previous month. The surveyed unemployment rate of the population with non-local agricultural household registration was 4.7%, significantly lower than the surveyed urban unemployment rate. In terms of consumer prices, influenced by a decrease in certain food and energy prices, the Consumer Price Index (CPI) in October rose by 0.3% year on year, with a slight decrease from the previous month. The core CPI, excluding food and energy, rose by 0.2% year on year, expanding by 0.1 percentage point from the previous month, showing positive changes.
"One boost" refers to the boost in market confidence. With the accelerated implementation of existing policies and the strong introduction of a package of incremental policies, October not only saw a noticeable recovery in major production and demand indicators but also a boost in market confidence. This was reflected in active stock and real estate market transactions as well as with the expectations of enterprises and consumers improving. The real estate market saw an increase in new housing sales and a significant improvement in second-hand housing transactions, with enhanced market activities. From January to October, the fall in sales of new commercial housing by sales area and sales value narrowed by 1.3 and 1.8 percentage points, compared with the first nine months. The substantial improvement in October was the first of the year. In terms of the capital market, it also saw a significant trend in recovery. In October, the stock trading volume and turnover in the Shanghai and Shenzhen stock markets increased by about 1.5 times year on year, making it the largest growth rate rebound this year. In terms of business entities' expectations, the purchasing managers' index (PMI) for the manufacturing sector was 50.1% in October, up 0.3 percentage point from the previous month. This is the first time that manufacturing PMI has returned to the expansion range since May of this year. In terms of consumer expectations, the consumer confidence index rebounded by 1.2 percentage points from the previous month, marking the first increase after six consecutive months of decline. These changes will greatly stimulate market vitality and drive economic upturn.
On the whole, under the influence of various policy measures taking effect, the national economy in October continued to make progress while ensuring steady performance, with significant rebounds in major economic indicators and boosts market confidence. However, it is also important to recognize that the international environment is still complex and severe while domestic demand remains weak, and some enterprises are facing operational difficulties. In the next step, we must implement the decisions and arrangements of the Party's Central Committee, intensify macroeconomic regulation, effectively utilize effects of various policies, expand domestic demand, strengthen innovation-driven development, consolidate and enhance the positive momentum of economic recovery, and promote high-quality economic development.
Thank you.
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CCTV:
Since late September, the central government has introduced a raft of incremental policies. What role have these policies played on the national economic data in October? Also, how do you evaluate their performance? Thank you.
Fu Linghui:
Thank you for your questions. Recently, various departments have rolled out a package of incremental policies to promote economic upturn. With the accelerated implementation of existing policies and the launch of a package of incremental policies, major economic indicators in October have shown a significant rebound. Social expectations continue to improve, the quality of development has steadily enhanced, and positive factors have accumulated. The economy is stabilizing and recovering robustly. It can be said that the combined effect of these policies has been effectively unleashed, yielding substantial results. These results can be summarized in the following four aspects.
First, domestic demand has seen further expansion. Since October, the implementation of the "Two New" policy on "renewal & trade-in" (namely, large-scale equipment renewal and trade-in of old consumer goods) and the "Two major" initiative on carrying out major national strategies and building up security capacity in key areas has continued to play a positive role in releasing consumption potential as well as stimulating investment growth. In terms of consumption, driven by consumer goods trade-in programs, growth rates in October for units above designated size in household appliances, audiovisual equipment, automobiles, furniture as well as cultural and office supplies have all accelerated compared to the previous month. These four categories alone contributed 1.2 percentage points to the month-on-month acceleration of 1.6 in total retail sales for consumer goods, showing clear results and a more significant improvement than in September. In terms of investment, driven by large-scale equipment upgrades, investments in equipment and tools increased by 16.1% year-on-year from January to October, driving the growth of total investments by 2.1% and contributing to investment growth's rate exceeding 60%. Meanwhile, as the "Two Major" initiative continues to gain momentum, the physical workload of related projects has gradually taken shape, which has also driven the recovery of investment in infrastructure. The country's investment in infrastructure construction rose 4.3% from a year ago during the January-October period, 0.2 percentage point faster than the previous month, marking the first rebound of recent infrastructure investments.
Second, production has seen further stimulation. Improved demand has driven positive production trends in related industries. For instance, the production of consumer goods linked to trade-in programs, such as new energy vehicles and home appliances, has seen rapid growth. Specifically, the production of new energy vehicles increased by 48.6% year-on-year, boosting the output of related industries such as charging piles by 25.2%. In household appliances, products like air humidifiers, room air conditioners and electric heating appliances have all seen double-digit production growth. In terms of the production of goods for investment, industries and products related to equipment upgrades have experienced significant growth. In October, the added value of smart consumer device manufacturing and shipbuilding, as well as related equipment industries, grew by 18.8% and 16%, respectively. The output of special equipment for processing agricultural products, traditional transportation machinery for excavating and shoveling and special equipment for packaging increased by 54.5%, 28.4% and 19.2%, respectively. These situations also reflect a strong boost in large-scale equipment renewal when it comes to production within the equipment industry.
Third, confidence has seen a further boost. As the effects of the package of incremental policies become increasingly apparent, market vitality has increased and confidence among businesses, consumers and investors has risen. For businesses, indexes such as Purchasing Managers' Index for the Manufacturing Sector and Business Activity Index for the Service Sector returned to expansionary territories in October. Among them, the manufacturing production and business activity expectations index reached a recent high point while the non-manufacturing business activity expectations index moved into a higher prosperity zone, reflecting growing confidence with market development. For consumers, the consumer confidence index has risen for the first time after six consecutive months of decline. At the same time, the capital market has warmed up, with transaction volumes and amounts in the Shanghai and Shenzhen stock markets reaching new highs in October. The growth rate of sales income from capital market services also has significantly increased by more than 10 percentage points compared to the previous month. Both of these reflect a gradual restoration of investors' confidence.
Fourth, development has seen further promotion. Overall, under the impetus of a series of policy combinations, the national economy in October maintained stability and saw progress, with momentum for economic recovery strengthened. At the same time, under policy support, the quality of development has also been steadily improved. In the context of updates to automobile scrapping and trade-in programs, most users have opted for new energy vehicles, driving a rapid increase in sales of new energy vehicles in October, with domestic retail penetration exceeding 50% for four consecutive months. Sales of high-efficiency, energy-saving home appliances compliant with low-carbon requirements have achieved double-digit, year-on-year growth, adding momentum to green development. Additionally, the "Two Major" initiative has strongly supported the construction of high-standard farmland, underground pipeline networks, urban renewal and other welfare projects, stabilizing growth in investment within the welfare sector. Moreover, the real estate market has been stabilized, local governments have been orderly progressing in their efforts with debt management, risks in key areas have been gradually resolved, and the foundation for safe development has been consolidated.
In the next stage, as various regions and departments intensify the implementation of policy measures, the effects of these policies are expected to continue to be felt. However, it must also be recognized that the external environment remains complex and severe, with the internal driving forces of the economy still needing to be strengthened further. We must further enhance our sense of responsibility and urgency, make full use of the comprehensive package of incremental policies, maximize policy effectiveness and promote a favorable economic rebound. Thank you.
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Yicai:
This year's government work report set the annual economic growth target at around 5%. Based on the economic data for the first ten months of this year, what is your view on the fourth quarter's trend? Additionally, do we currently have the positive and favorable conditions to achieve the annual target? Thank you.
Fu Linghui:
Thank you for your questions. The realization of this year's economic growth target is of great concern. This year, in the face of complex changes within the international environment as well as new situations and challenges within the domestic economy, under the strong leadership of the Party Central Committee, various regions and departments have strengthened counter-cyclical adjustments. As a result, the national economy has maintained a stable and progressive growth trend overall. GDP grew by 4.8% year on year in the first three quarters, laying a solid foundation for achieving the annual development goal. From economic changes in September and October, particularly in October, we have gained further confidence in achieving the annual economic development target. The confidence comes from several aspects:
First, the momentum for economic recovery has been strengthened. From major indicators in October, the service industry showed a clear recovery. The service sector production index in October increased by 1.2 percentage points compared to the previous month, representing the highest growth rate this year as well as a continuing acceleration in growth rate for two consecutive months. Driven by relevant policies, the financial industry production index accelerated by 3.7 percentage points while the real estate production index showed a year-on-year increase of 0.8% this month, marking the first time since June of last year that the industry shifted from decline to growth. Market sales also accelerated, driven by favorable factors such as the policy for consumer goods trade-in programs, the National Day holiday and early "Double Eleven" promotional activities. In October, the total retail sales of consumer goods increased by 4.8% year on year, 1.6 percentage points faster than the previous month, with retail sales of goods accelerating by 1.7 percentage points. With the recovery of market demand, the coordination between enterprise production and sales has improved. In October, the production-sales ratio of industrial products above a designated size reached 97.3%, up by 1.3 percentage points from the previous month, attaining the second-highest level this year. At the same time, driven by "Two Major" construction, infrastructure investments increased by 4.3% year on -year from January to October, seeing an acceleration compared to the period between January and September.
Second, the effectiveness of macroeconomic policies has become noticeable. In the face of new issues and challenges in this year's economy, the Party Central Committee has taken a comprehensive view, confronted difficulties, made scientific decisions and acted promptly. A package of incremental policies has been launched and is steadily being implemented. October was the first month after the introduction of these policies. From that month's data, we can see that the effects from these policies are beginning to show. Major economic indicators have seen a significant rebound, especially in sectors related to the "Two New" and "Two Major" policies, such as significant growth in sales of automobiles, home appliances and office supplies. Investments in infrastructure such as water conservancy, ecological protection and roads have also shown steady growth. In the next phase, as various policies are fully implemented and yield results, the combined policy effects will further emerge and the positive factors and favorable conditions in economic operations will continue to increase, providing strong support for the economic recovery and growth in the fourth quarter.
Third, confidence with marketplace expectations has seen a boost. Confidence is a key factor in consolidating and enhancing the momentum of economic recovery. After the recent series of incremental policies were officially launched, market activity noticeably increased. The real estate market has warmed up, the capital market has rebounded and both business and consumer confidence have improved. In October, the volume of real estate consultations and property viewings significantly increased, while the sales area and sales volume of commercial housing improved considerably. The trading volume and value on the Shanghai and Shenzhen stock exchanges also grew sharply. The manufacturing's PMI and the service sector's Business Activity Index both rose into the expansion zone, and the consumer confidence index also showed an uptick for the first time in recent months. As long as confidence is present, businesses will be willing to expand investment and production, while consumers will be willing to spend, which will strongly drive economic recovery.
In the next phase, we will earnestly implement the Party Central Committee's decisions and arrangements, further strengthen the implementation of various policy measures and reinforce policy coordination, continuously consolidating the momentum of economic recovery and growth and striving to achieve the annual economic growth target.
Thank you.
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Market News International:
How does the National Bureau of Statistics analyze the current real estate market performance? Have real estate-related indicators bottomed out? And what further policies are expected to promote the real estate market stabilization and recovery?
Fu Linghui:
Thank you for your questions. The real estate market is a hot topic that attracts a lot of attention. The Party Central Committee attaches great importance to the healthy development of the real estate market. At the meeting of the Political Bureau of the Central Committee on Sep. 26, it was emphasized that multiple measures should be taken to "promote the stabilization and recovery of the real estate market." Relevant departments have been working quickly to improve policies related to land, taxation and finance, focusing on the implementation of stock policies and the introduction of incremental policies, thus creating a comprehensive approach. As these policies are gradually implemented, confidence in the real estate market has been boosted and market transactions have become more active, leading the real estate market moving toward stabilization and recovery.
On the sales side, market vitality has improved significantly. Down payment ratios and mortgage interest rates have been lowered. Measures restricting house purchases, sales and pricing have been lifted, effectively ensuring people's needs for basic and improved housing. In October, the real estate transactions accelerated. From January to October, compared to the decline in the first nine months, the year-on-year decline in sales area and sales value of new commercial housing narrowed by 1.3 and 1.8 percentage points, respectively. This marks the greatest monthly improvement for the year. According to the sales situation in 40 key cities monitored, improvements are more significant in second-tier cities that previously experienced with greater price corrections. In October, monthly sales area saw growth and sales value's decline narrowed significantly. Driven by gradually stabilized prices, the sales value of first-tier cities in October realized growth. According to data from relevant departments, transactions of second-hand houses improved remarkably in October.
In terms of the prices, housing prices showed initial signs of stabilization. In October, among 70 large and medium-sized cities, four more cities, compared to the previous month, saw monthly growth in sales prices with new commercial housing, and eight more cities saw monthly growth in prices of second-hand houses. Among first-tier cities, the month-on-month decrease in sales prices of new commercial housing narrowed, and sales prices of second-hand houses ceased to drop and started to rise in comparison to the previous month. For second- and third-tier cities, the monthly decrease in sales prices of new commercial housing and second-hand houses narrowed to varying degrees. The recovery in sales and stabilization of prices have led to an improvement in the cash flow of real estate enterprises. In the first 10 months, the year-on-year decrease in funds raised by real estate development enterprises narrowed by 0.8 percentage point compared to the first nine months. Closely related to property sales, decrease in earnest money, advance payments and personal mortgage loans all narrowed by 2.1 percentage points.
In terms of expectations, the real estate market sentiment has improved. According to PMI data, the business activity index for the real estate sector saw an improvement of 2.5 percentage points in October compared to the previous month, and the market expectation index rebounded by 1.8 percentage points, indicating an improvement in the climate level of the real estate sector as well as in marketplace expectations. In October, a survey on property development enterprises and real estate agencies across 70 large and medium-sized cities showed that the proportion of surveyed employees anticipating stable or rising sales prices for both new commercial housing and second-hand homes in the next six months further grew from the already increased proportions in September by 17.6 and 15 percentage points, respectively. This indicates that related business institutions have a growing confidence in the real estate sector.
In general, a package of measures to stabilize the real estate market is proving effective. Positive changes in the real estate sector emerged in October. As the effects of these policies continue to unfold, the momentum driving the stabilization of the real estate market will be enhanced. Therefore, we are optimistic on the future development of the real estate sector. However, it should be noted that, after long-term rapid expansion, the real estate market has entered a new stage of development and will pivot from quantitative expansion to qualitative improvement to better satisfy people's diverse housing needs. Moving forward, we will diligently implement the decisions and arrangements of the CPC Central Committee and the State Council, adapting to the reality of profound changes in the supply and demand relationship of the real estate sector. We will strictly control expansion, optimize existing resources and improve the quality of housing. We will coordinate efforts to refine policies regarding land use, taxation and financing to quickly foster a new development model for the real estate sector and to promote the steady and healthy development of the sector. Thank you.
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N Videos at Southern Metropolis Daily:
We have noticed that the year-on-year increase in the CPI in October fell slightly compared to the previous month. What are the reasons behind this? How do you view the current price level? And what is your prediction for future development? Thank you.
Fu Linghui:
Thank you for your questions. Impacted by fluctuations in food and energy prices, the CPI experienced a slight year-on-year and month-on-month decrease in October. Though, this monthly change is normal.
In terms of monthly changes, the October CPI was down by 0.3%, same as the previous month. Food prices had the biggest impact. The monthly decrease in food prices was 1.2% and this was the main factor causing the monthly decrease of the CPI. Prices for pork, fresh vegetables, fresh fruit and aquatic products saw monthly decreases ranging from 1% to 3.7%, accounting for 0.2 percentage point or around 70% of the overall CPI decrease. This was mainly because the prices for certain types of fresh food went up due to extreme weather in September, with the prices then falling in October as the impact of extreme weather disappeared.
In terms of year-on-year changes, the October CPI rose by 0.3% over the same period and was 0.1 percentage point lower than the previous month. The slower year-on-year growth is mainly attributed to the fall in food and energy prices. In October, food prices rose by 2.9% year on year, 0.4 percentage point lower than the previous month, accounting for 0.1 percentage point of a narrow CPI increase. Among all food categories, prices for fresh vegetables, fresh fruit and pork saw their year-on-year increases fall in comparison to the previous month. In October, the decrease in energy prices expanded by 1.6 percentage points in comparison to the previous month, which also contributed to the lowered increase of CPI.
Excluding food and energy, prices for most products and services remained stable or slightly improved. The core CPI rose by 0.2% year on year in October, 0.1 percentage point higher than the previous month, showing a slight recovery. Service prices rose by 0.4% year on year in October, 0.2 percentage point higher than the previous month. The rental of vehicles rose by 3.2%, presenting a small increase which was driven by holiday consumption booms during the month.
Overall, consumer prices remained relatively stable in October, with prices in some sectors exhibiting small increases that were driven by boosts in demand. In the next phase, China is expected to have a bumper harvest, and the supply of live pigs and fresh vegetables is expected to be stable. As winter and New Year's Day approach, food prices will likely stabilize at a slightly higher level. In terms of industrial consumables, energy prices could be impacted by import prices, although most products will be able to maintain sufficient supply and stable prices. Supply of services will be generally stable. As the economy improves, it will drive increased demand for services, thus drive up service prices. Considering all these factors, the CPI will maintain a trend of mild increases in the future.
Thank you.
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CNBC:
Has the consumption sector seen a clear upward trend? Thank you.
Fu Linghui:
Thank you for your question. Consumption is a matter of great interest to everyone, and has also emerged as a major bright spot in the economy. In October, the consumer goods trade-in program, the National Day holiday, the early launch of the annual Double 11 shopping festival, and the warming stock and property markets were among the major factors bolstering consumer confidence. In October, the growth rate of market sales picked up significantly, the growth of commodity retail sales accelerated, and service retail sales maintained fast growth, with consumption playing a large role in driving the economy. This was mainly reflected in the following aspects:
First, market sales accelerated significantly. In October, total retail sales of consumer goods increased by 4.8% year on year, 1.6 percentage points higher than the previous month. Commodity retail sales increased by a large margin, 1.7 percentage points faster than September. Sales of upgraded commodities registered fast growth. In October, the retail sales of cosmetics, and sports and entertainment goods by enterprises above designated size increased by 40.1% and 26.7%, respectively.
Second, the consumer goods trade-in program played a significant role in boosting market sales. Through trade-in policies in the automobile, household appliance, and home decoration sectors, the retail sales of household appliances, automobiles, stationery and office supplies and furniture by enterprises above designated size contributed 1.2 percentage points of the overall growth of retail sales in October, an increase significantly larger than the previous month.
Third, new types of consumption flourished. The fast development of new business models and forms, such as instant retail and livestreaming sales, boosted online consumption. In the first 10 months, online retail sales of physical goods increased by 8.3% year on year, 0.4 percentage point higher than for the January-September period. Meanwhile, with changes in people's thinking toward consumption, environmentally friendly and health-related consumption is booming, leading to strong growth in sales of relevant commodities. In the first 10 months, sales of NEVs and smart home appliances continued to grow quickly.
Fourth, service retail sales registered fast growth. Increased travel and robust cultural and tourism consumption during the National Day holiday supported the rapid growth of service retail sales. During this year's National Day holiday period, domestic trips and total tourist spending increased by 5.9% and 6.3% year on year, respectively, on a comparable basis; and the number of commercial performance viewers nationwide increased by 13.3%. In the first 10 months, service retail sales surged 6.5% year on year, maintaining a faster growth rate than commodity retail sales. Specifically, retail sales for transportation and information transmission service sectors both maintained double-digit growth.
Overall, market sales accelerated significantly and consumer confidence improved in October, which helped stabilize and boost the economy. However, factors that hinder consumption development still remain, such as limited consumer willingness and purchasing power. Next, we will actively promote high-quality and full employment, support sustained household income growth, give full play to the consumer goods trade-in program, and improve residents' propensity to consume. Meanwhile, we will strive to improve the quality of commodities and services, better satisfy the needs of upgrading consumption, and unleash the potential of consumption, so as to promote sustained and sound economic growth. Thank you.
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21st Century Business Herald:
How do you view the investment situation in October? You mentioned earlier that the cumulative growth rate of infrastructure investment rebounded for the first time in October. Can this recovery be sustained in the future? In addition, what impacts have the large-scale equipment upgrades and consumer goods trade-in program, as well as the policies to implement major national strategies and build up security capacity in key areas, had on investment? Thank you.
Fu Linghui:
Thank you for your questions. Investment is also an important part of the economy. In the first 10 months, although investment in the real estate was declining, China's overall investment scale continued to expand due to the large-scale equipment upgrade program, the innovation-driven development, and industrial upgrading and development. Investment in manufacturing and large projects grew rapidly; and investment in innovation continued to increase. All these supported the stable growth of investment and created favorable conditions for the country's high-quality development. The first 10 months can be categorized as follows:
First, investment expansion continued to stabilize. Fixed-asset investment (excluding rural households) rose 3.4% year on year in the first 10 months. The growth rate maintained at 3.4% for three consecutive months, showing a clear stable trend. We can see that investment has generally registered a downward trend so far since the start of this year, but it has been basically stable for the past three months. Large project investment played an important role in supporting investment expansion. In the first 10 months, the completed investment in projects with a planned total investment of more than 100 million yuan increased by 7.1% year on year, driving the growth of total investment by 3.8 percentage points and promoting stable investment growth.
Second, the policy effect of driving investment was reinforced. The policy effect of the large-scale equipment upgrade program has continued to manifest. In the first 10 months, investment in purchasing equipment, tools and instruments jumped 16.1% year on year, significantly faster than the overall investment growth. Such investment accounted for 14.8% of total investment and contributed more than 60% of overall investment growth. The steady progress in implementing major national strategies and building up security capacity in key areas drove the rebound of infrastructure investment. During the January-October period, investment in infrastructure construction rose 4.3% year on year, 0.2 percentage point faster than September, and marking the first rebound since March. As seen from the current situation, with the release of various policies and the recent progress in local debt relief, the infrastructure capacity of local governments will continue to improve, providing favorable conditions and a basis for the stable growth of infrastructure investment.
Third, manufacturing investment increased rapidly. Driven by industrial upgrading and development, investments in equipment manufacturing and consumer goods manufacturing registered a positive growth momentum, which supported the development of manufacturing investment. In the first 10 months, manufacturing investment increased by 9.3% year on year, 0.1 percentage point faster than the January-September period. In particular, investments in equipment manufacturing and consumer goods manufacturing grew 9.1% and 15%, respectively.
Fourth, investment in high-tech industries remained active. All localities have actively fostered and strengthened new quality productive forces, investing more in technological innovations and striving to stay ahead of the curve in industrial development, driving the growth of investment in high-tech industries. In the first 10 months, investment in high-tech industries increased by 9.3% year on year, significantly faster than the overall investment growth. Specifically, investment in aircraft, spacecraft and equipment manufacturing increased by 34.5%; investment in professional technical services increased by 32%; and investment in research, development and design services increased by 11%.
Overall, China's investment maintained stable growth recently, with the investment structure continuing to improve. Next, as the combined effects of existing policies and a raft of incremental policies become apparent, investment funding guarantees and project support will gradually improve, and the growth of investment is expected to continue.
Thank you.
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Shou Xiaoli:
Let's continue. Due to the limited time, we will take two final questions.
The Poster News APP:
What do you think of the highlights of last month's industrial data and the overall situation of China's current industrial production? Thank you.
Fu Linghui:
Thank you for your questions. Since the beginning of this year, China's industrial production has witnessed rapid growth, marking an important highlight of economic performance. Judging from the situation in October, market demand has picked up under the impetus of policies. Business expectations have improved, industry has remained steady and grown rapidly, and the manufacturing industry has upgraded and developed. The equipment manufacturing industry and high-tech manufacturing industry have played an important supporting role. This was mainly reflected in the following aspects:
First, the industrial sector maintained steady and rapid growth. In October, the added value of industrial enterprises above designated size increased by 5.3% year on year, with a slight slowdown in the growth rate. The slowdown in October can mainly be attributed to the normalization of power production following a surge in September driven by extreme weather. In terms of the three major industrial categories, the growth rate of the production and supply of electricity, heat, gas and water declined, while the growth rates of the mining and manufacturing industries accelerated compared to the previous month. In terms of growth momentum, the market recovery in October led to an increase of 5.4% year on year in the added value of manufacturing above designated size, 0.2 percentage point higher than the previous month. At the same time, the pull of exports on production continued to be evident. In October, the delivery value of industrial exports above designated size increased by 3.7% year on year, 0.3 percentage point higher than the previous month.
Second, the industrial structure has been continuously improved. This is mainly reflected in the growth momentum of equipment manufacturing. Under the policy drive of industrial upgrading and the promotion of large-scale equipment renewal, production in the equipment manufacturing industry has maintained steady growth. In October, the added value of the equipment manufacturing industry increased by 6.6% year on year, continuing to outpace the overall industrial sector above designated size. Among them, the automobile manufacturing industry, the computer communications and other electronic equipment manufacturing industries grew by 6.2% and 10.5%, respectively. The development of the equipment manufacturing industry has not only supported rapid industrial growth but also contributed to improved industrial production efficiency.
Third, new industrial momentum is growing at an accelerated pace. Under the policy of high-quality industrial development, China's manufacturing industry is making a clear shift toward higher-end, intelligent and green development, with new growth drivers continuously accumulating. In October, the added value of high-tech manufacturing increased by 9.4% year on year. Among them, the output of integrated circuits and industrial robots increased by 11.8% and 33.4% year on year, respectively. The production of smart devices and green products continues to grow rapidly. In October, the added value of the unmanned aerial vehicle (UAV) manufacturing industry increased by 41.9%. Meanwhile, the production of NEVs and solar cells grew by 48.6% and 13.2%, respectively.
Fourth, industrial sentiment is on the rise. Against the background of the accelerated implementation of a raft of incremental policies and improved market demand, the connection between production and sales in industrial enterprises has been strengthened, leading to a recovery in industrial sentiment. In October, the production and sales rate of industrial enterprises above designated size increased by 1.3 percentage points compared to September. The Manufacturing Purchasing Managers' Index has risen back into the expansionary range. The Manufacturing Business Outlook Index increased by 2 percentage points compared to the previous month, showing a significant rise.
Overall, in October, industry experienced steady and relatively fast growth, high-quality development progressed steadily, and new growth drivers continued to emerge. However, it is also important to note that industrial enterprises are still facing challenges such as low market prices and difficulties in improving profitability. Next, it is important to effectively implement various policies supporting industrial development, focus on expanding domestic demand, consolidate and strengthen positive changes, and promote high-quality industrial development. Thank you.
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Shou Xiaoli:
Last question, please.
Red Star News:
The month-on-month decline in PPI narrowed significantly in October, while the year-on-year decline widened slightly. What are the reasons behind this? And how do you forecast the trend of PPI in the next stage? Thank you.
Fu Linghui:
Thank you for your questions. There is considerable interest in PPI prices. Due to the downward fluctuation of international crude oil prices and increased competition in certain domestic industries, the industrial producer prices in China decreased by 2.9% year on year in October, with the decline slightly widening compared to the previous month. Among them, industries that are more affected by international input factors saw a larger decline in prices, particularly in the energy sector. In October, prices in the oil and natural gas extraction industry dropped by 14.6%, while prices in the oil, coal and other fuel processing industries decreased by 13.9%. Both declines widened by 4.5 percentage points compared to the previous month. At the same time, technological advancements in some domestic industries are accelerating, and market competition is intensifying, which has led to a further widening of price declines. This has also had an impact on PPI to some extent. In October, the prices in the automobile manufacturing industry decreased by 3.1% year on year, with the decline widening by 0.8 percentage point compared to the previous month.
Although the year-on-year decline in prices slightly widened in October, the accelerated implementation of a raft of incremental policies has begun to show effects in expanding demand for relevant industries, leading to positive price changes in some sectors. For example, prices for steel and cement have stopped falling and started to rebound. In October, the prices in the ferrous metal smelting and rolling processing industry increased by 3.4% month on month, marking the first month-on-month rise after four consecutive months of decline. The prices in the non-metallic mineral product industry rose by 0.4% month on month, marking the first increase after three consecutive months of month-on-month declines.
Overall, due to the combined effects of the downward input of international commodity prices and domestic policies aimed at expanding demand, PPI remained broadly stable in October. In some sectors, there were even signs of prices stabilizing and starting to rebound. Next, to address the sluggish PPI trend, it is essential to actively leverage various policy measures, further expand domestic demand, and deepen supply-side structural reforms. This should include strengthening innovation-driven development, vigorously promoting capacity adjustment, and fostering a high-level dynamic balance between supply and demand. These efforts will help stabilize and rebound prices, improve business profitability, boost the confidence of enterprises, and contribute to the sustained and healthy development of the economy.
Thank you.
Shou Xiaoli:
Today's briefing is hereby concluded. Goodbye.
Translated and edited by Wang Ziteng, Chen Xinyan, Liao Jiaxin, Xiang Bin, Liu Sitong, Li Xiao, Wang Xingguang, Yuan Fang, Huang Shan, Ma Yujia, Zhou Jing, Li Huiru, Wang Yiming, Wang Qian, David Ball and Rochelle Beiersdorfer. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
