The CICC Finance Research Report pointed out that at the press conference of the State Information Office last Saturday, the Ministry of Finance announced a series of incremental fiscal policies. We believe that these measures may mean an increase in the scale of government bond issuance in the fourth quarter and provide some support for social financing in the fourth quarter. However, it may still be difficult to actually achieve significant growth in social financing by relying on government bonds alone. As can be seen from the situation in the first three quarters, the cumulative increase in social financing reached 25.7 trillion yuan, a year-on-year decrease of 3.7 trillion yuan. Among them, net government bond financing reached 7.2 trillion yuan, an increase of 1.2 trillion yuan over the previous year, and private sector financing totaled 18.5 trillion yuan, a decrease of 4.9 trillion yuan over the previous year. Although government sector financing continued to grow, private sector financing demand declined markedly, and overall social financing growth was relatively insufficient. In the context of the Ministry of Finance's statement that “the central government still has more room to borrow and raise the deficit,” government bond financing may still be relatively high next year, but we believe that if private sector financing cannot be fundamentally improved, overall social financing may still be difficult to expand significantly. Judging from historical experience, whether policy stimulus will lead to a reversal upward trend in the economy and a rebound in interest rate trends mainly depends on whether it can lead to a stepwise rise in social finance growth. If we do not see a significant expansion in social financing for the time being, we have yet to see a trend recovery in capital returns. This also corresponds to the fact that interest rates will not rise in a trend.

The CICC Finance Research Report pointed out that at the press conference of the State Information Office last Saturday, the Ministry of Finance announced a series of incremental fiscal policies. We believe that these measures may mean an increase in the scale of government bond issuance in the fourth quarter and provide some support for social financing in the fourth quarter. However, it may still be difficult to actually achieve significant growth in social financing by relying on government bonds alone. As can be seen from the situation in the first three quarters, the cumulative increase in social financing reached 25.7 trillion yuan, a year-on-year decrease of 3.7 trillion yuan. Among them, net government bond financing reached 7.2 trillion yuan, an increase of 1.2 trillion yuan over the previous year, and private sector financing totaled 18.5 trillion yuan, a decrease of 4.9 trillion yuan over the previous year. Although government sector financing continued to grow, private sector financing demand declined markedly, and overall social financing growth was relatively insufficient. In the context of the Ministry of Finance's statement that “the central government still has more room to borrow and raise the deficit,” government bond financing may still be relatively high next year, but we believe that if private sector financing cannot be fundamentally improved, overall social financing may still be difficult to expand significantly. Judging from historical experience, whether policy stimulus will lead to a reversal upward trend in the economy and a rebound in interest rate trends mainly depends on whether it can lead to a stepwise rise in social finance growth. If we do not see a significant expansion in social financing for the time being, we have yet to see a trend recovery in capital returns. This also corresponds to the fact that interest rates will not rise in a trend.