经济月报（2022年1月）

MONTHLYECONOMICBULLETIN MilderOmicronsymptoms,fasternormalization? China Zero-COVID policy, liquidity crunch saga in property sector,and ongoing regulatory clampdown would drag growthExports could ease the impact of headwinds butinsufficient to offset allChina to cautiously step up accommodative fiscal andmonetary measures to avert a hard landing EuropeEntering 2022 with some interruptions but Omicron will have milder impact thanprevious wavesHealth and political risks could prompt theECB to maintain accommodative policy thisyear while slowly exiting from pandemicstimulusHouseholds could face rising cost of living in1H; solid labor market and above-targetinflation will allow central bank to raise rates Japan US Sixth wave could hurt economy butimpact would be smaller than Delta-waves given nascent recoverySupplementary budget and ultra-loosemonetary policy could help cushionlatest pandemic impact despite taking atiny step to exit crisis stimulus Omicron will hurt services sector but notoverall economic conditionsInflation will stay hot in 1Q22 butunlikely to dampen consumer spendingthis yearUS Fed is ready for liftoff and prepares totrim balance sheet GlobalgrowthcouldslowdownbecauseofOmicronbutimpactwouldbelimited;recoveryisunderway,allowingpolicynormalizationinsomemajorcountries Globaleconomicactivitieshadimprovedmarkedlyin2021.Thoughsupply-sideproblemslimitedgrowthinthemanufacturingsector,servicessectorrecoveredstronglyamidprogressinvaccinationinadvancedcountries.Mostmajorcountries,exceptChina,registeredstrongergrowthin2021.TheOmicronwavesincelate-2021mighthurtsomeactivities,especiallyservices,butitwouldhavelimitedimpactbecauseofmildersymptomandlowerfatalityrateamidhighervaccinationrates.Economicrecoveryisunderwaywithfallingunemployment,allowingseveralcountriestonormalizecrisisstimulusprograms. servicessectorbutnotoveralleconomicconditions OmicroncaseshavesurgedintheUSsincelate2021,especiallyamongtheyoungandunvaccinatedpopulation,buttherearefewerfatalitiescomparedtotheDeltawave.ThelatestoutbreakhascausedthelargestdropinServicesPMIfrom69.1Novemberto62inDecember,particularlynewordersandbusinessactivityindices.Employmentindexedgeddown,suggestingbusinessescontinuetohireworkers.Manufacturingsectorisstilldemand-drivenandhasseenlimitedimpactfromtheoutbreak.Forconsumers,theOmicronvariantisunlikelytohaltspendingasmobilitydataingrocerymarkets,restaurantsandshoppingcentersarebetterthanduringpreviouswaves.Lookingforward,theCDCbelievestherewouldbeasurgeandsharpdropinOmicroncases,likeinSouthAfricawherecaseshavepeakedandarefalling.IntheUS,althoughdailynewcasesremainworrying,thesituationislikelytoimproveahead.TheWeeklyEconomicIndexsuggestsoveralleconomicactivities(asof8January2022)remainstrongandareunlikelytocontractbecauseofthelatestoutbreak.Hence,weexpecteconomicactivitiestoremainsolidandthesmaller-than-expectedCOVID-19impactcouldliftconsumerexpectationsandspendingahead. unlikelytodampenconsumerspendingthisyear CPIinflationwillcontinuetorunhotin1Q22.Datashowsbroadpricegainsingeneralcategoriesbuttherearesignsinflationisunlikelytotakeabiteoutofspendingthisyear.Firstly,theOmicronoutbreakhashadminimalimpactonspendingongoods.Secondly,averagewagegrew4.7%inDecemberwhilerealwageishigherthanpre-pandemictrend.Thirdly,housepricesaresettocooldownin2022anddeliverytimesareshorter,whichwouldhelpfirmstoavoidgoodsshortageandallowconsumerstosavetospendinthefuture.Lastly,theBidenadministrationhaveattemptedtocontroloilandmeatpriceswhileaskingtheprivatesectortohelpeasesupplybottlenecks.Moreover,themid-termelectionsmightpromptthegovernmenttoacttomaintainpopularity.Thesefactorscouldsupportpurchasingpowerandstrongconsumerdemand.Andasinflationremainsabovepre-pandemictrendsanddemandremainssolid,thatwouldallowtheFedtoproceedwithplanstotightenmonetarypolicy. readyforliftoffandpreparestotrimbalancesheet Arobustlabormarket,persistentinflation,milderCOVIDsymptoms,andmorehawkishFedmembers,aresupportingafaster-than-expectedratehike.Evenwithdisappointingpayrolls,thelabormarketmighthavereachedmaximumemployment.Unemploymentrateplungedto3.9%inDecemberlastyear,betterthantheFed’sprojectionof4.3%,whilelaborforceparticipationrateisabout1.5%belowFeb-20level.TheFedexpectsOmicrontohaveonlymildimpactontheeconomy,reflectedbytheupwardrevisionof2022GDPgrowth.Inaddition,investorsareoptimisticabouttheeconomyandhaddriven10-yeartreasuryyieldto1.7%earlythisyearandcausedtheDollartoappreciate.Weseerisingprobabilityofthefirst-ratehikeinMarch2022,followedbyatleast2morehikesbeforetheendoftheyear.TheFOMCestimatesrateswouldhit0.9%by2022and1.6%in2023,suggestingacontinuityofthehikingcycle.Moreover,theFedmightstarttotrimbalancesheet(quantitativetightening)soonafterstartingtoliftrates.Thisaggressivetighteningcouldraiseconcernsinstockandcurrencymarketsworldwidebutwemaintainthatgloballiquiditywouldremainabundantandisunlikelytodropsharply. Europe:Entering2022withsomeinterruptionsbutOmicronwillhavemilderimpactthanpreviouswaves Omicronwillhindereconomicgro