at present, the fundamentals of the chinese economy remain sound in the long run, and it will continue to maintain a sound momentum of development in the future. however, it should also be noted that the economic recovery is still unbalanced and the foundation is not solid. what is pressing now is to make good use of the window period, during which there is less pressure to maintain steady growth, to keep the economy operating within a reasonable range, and to bring the chinese economy to a higher level and balance in the course of recovery.
with the release of major macroeconomic data for may, the overall trend of china's economy in the first half of the year is almost a foregone conclusion. compared with the forecasts of some market institutions at the beginning of the year, china's economic performance in the first five months was more steady and steady, with a number of key indicators exceeding market expectations. this further confirms the central government's judgment that the economy is in a "window period with less pressure on steady growth".
from the perspective of major macro data, the "stable" momentum of the chinese economy is continuing -- steady growth in both supply and demand, steady and orderly recovery of consumption, and steady recovery of investment growth. in may, exports, consumption and investment all recorded double-digit growth year-on-year, providing strong support for the steady recovery of the economy.
although china's economy is recovering well on the whole, it should be noted that growth is still unbalanced. in particular, due to the impact of a low base in the same period of last year, some macro indicators look good on the data, but there is a big gap between them and the actual perception of some micro entities, and many small and micro businesses still face many difficulties in their development. in addition, the uncertainties of the global epidemic and the complex and volatile international situation have made the prospects of recovery of the world economy uncertain and brought new situations and problems to china's economic development, which should be paid close attention to and actively responded to.
first, will the rise in the producer price index feed through to the consumer price index and trigger inflation? since the beginning of this year, some international commodity prices have risen sharply, directly pushing up ppi inflation. china's producer price index (ppi) rose 9% in may to a 10-year high. in order to curb the unreasonable rise of commodity prices, the executive meeting of the state council has focused on the issue of commodity prices for three consecutive weeks, and relevant departments have strengthened the linkage of supervision and adopted comprehensive measures to cool down the "high fever" commodity market. recently, the relevant departments have released copper, aluminum, zinc and other state reserves to non-ferrous metal processing and manufacturing enterprises in batches, and the related market fluctuations are also gradually leveling off. on the whole, no matter the supply and demand relationship of the market or the conditions of fiscal and monetary policies, the continued rise of ppi lacks the support of the future market, so there is still a foundation and conditions for prices to remain stable this year.
second, the year-on-year growth rate of consumption in may fell 5.3 percentage points from the previous month. does this mean that the weak trend of consumption has not been effectively reversed? this is not the case. may ushered in the "may day" five-day small holiday, and coincides with the national consumption promotion month, consumption around the country showed explosive growth, the reason for the year-on-year pullback, mainly because of the higher base comparison last year. from the two-year average growth rate, excluding the impact of the base effect, the average two-year growth rate of consumption in may was 4.5%, up 0.2 percentage points from the previous month, indicating that the consumer market is still gradually recovering. with the epidemic under effective control in china and the continuous improvement of the vaccination rate, it is expected that consumption will still have a large recovery space in the future. on the one hand, we need to continue to deepen supply-side structural reform and optimize and expand supply. on the other hand, we need to ensure that policies and measures to expand domestic demand and consumption are effective, so that consumption can truly play its role as the "first engine" of consumption.
thirdly, the two-year average growth rate of manufacturing investment in the first five months has turned from negative to positive. can this be used as a signal of accelerated recovery of investment? indicators such as capacity utilization rate of manufacturing in the first quarter hit a record high in the same period and profits of manufacturing enterprises maintained rapid growth show that the foundation for sustained recovery of investment in china's manufacturing industry this year is steadily consolidating. with the accelerated implementation of the carbon peak and carbon neutral detailed policies, the investment confidence of manufacturing enterprises has been further enhanced, especially in high-tech manufacturing, which continues to lead the investment, injecting new momentum into the overall recovery of investment. it should be pointed out that private investment, which is also an important driver of expanding domestic demand, has also recovered steadily. under the combined action, the driving force of investment repair is gradually shifting from policy-driven to internal one, and investment is expected to play a better role in optimizing the supply structure.
at present, the fundamentals of the chinese economy remain sound in the long run. as we continue to promote the double cycle and build a new pattern of development, the chinese economy will continue to maintain a sound momentum of development in the future. however, it should also be noted that the economic recovery is still unbalanced and the foundation is not solid. what is pressing now is to make good use of the window period, during which there is less pressure to maintain steady growth, to keep the economy operating within a reasonable range, and to bring the chinese economy to a higher level and balance in the course of recovery.
source: state-owned assets and administration commission of the state council