Clues of "anti-involution" in financial data
CICC pointed out that corporate short-term loan financing has significantly increased, and the month-on-month growth rate of M1 has stopped declining, which may become an important clue for tracking the "anti-involution" policy. In June, the new short-term loans for enterprises reached a historical high, which may help promote the recovery of endogenous demand. The growth rate of fiscal deposits remains high, and there is still room for policy maneuvering; the pace of fiscal policy will affect the demand side. In June, fiscal deposits decreased by 820 billion yuan, and the year-on-year growth rate of the balance rose to 23.9%, indicating that fiscal policy still has the capacity to support growth
CICC:
The financing of short-term loans for enterprises has significantly increased, while the M1 growth rate has stopped declining month-on-month, which may become an important clue for us to track the "anti-involution" policy in the future. One characteristic of loans in June is that new short-term loans for enterprises reached 1.16 trillion yuan, setting a historical high.
If under the backdrop of "anti-involution," large enterprises actively increase short-term financial liabilities to repay payables, it may help to open up the debt chain and effectively promote the recovery of endogenous demand. In June of this year, 17 key automotive companies, including China FAW, Dongfeng Motor, GAC Group, and Seres, made a public commitment that "the payment period for suppliers will not exceed 60 days," and how this commitment is further implemented and fulfilled has attracted significant social attention. Whether the new short-term loans are used for debt repayment awaits verification by real data. An important data point that confirms our speculation is the industrial enterprise data for June, which will be released at the end of July. We can use the data on the accounts receivable recovery cycle of industrial enterprises to assist in our judgment.
The growth rate of fiscal deposits remains high, and there is still policy room, which is another clue for us to track the "anti-involution" policy. In addition to focusing on the impact of "anti-involution" on accounts receivable, another data point we have consistently emphasized is the change in fiscal deposits. "Anti-involution" starts from the supply side, helping to improve the return on investment of existing assets and stabilize prices, but if demand is insufficient, the sustainability of price stabilization may also be weak. To continuously promote price recovery, we still need to focus on the demand side, and an important observation point is the rhythm of fiscal policy. In June, fiscal deposits decreased by 820 billion yuan, roughly in line with last year, and the year-on-year growth rate of fiscal deposit balances further increased to 23.9%, indicating that fiscal policy still has room to support growth and monetary supply this year. According to our calculations, if the growth rate of fiscal deposits falls back to normal levels, the released funds could boost the M2 growth rate by 0.2-0.3 percentage points.
