【英文】德银报告：中国市场策略：下半年会发生什么？（35页）

英文研究报告 2020年08月18日 07:13 管理员

5G smartphone replacement cycle has just started. 5G smartphone sales have picked up in recent months and now accounts for almost half of all smartphone sales. This is despite that 5G network is still being rolled out and the coverage remains limited, the government's plan is to have 5G network available in about 300 cities by end-2020, and to improve coverage in the next few years. 5G phone sales will likely accelerate once 5G network becomes more widely available. If 5G　roll out follows the past experience of 4G, it should take over 80% of all smartphone sales by end-2020, and drive up total smartphone sales for the next 2-3 years.In contrast, CPI inflation will likely stay at low levels. Core CPI inflation is unlikely to pick up in H2. Rent, travel costs, and clothing prices will likely stay low in H2 owing to weak job markets and reduced mobility. Headline inflation is more uncertain, which will depend on food prices, especially pork. Pork prices, after doubling in 2019 owing to the African swine fever, have fallen by about 10% this year thanks to supply recovery, increased imports, as well as reduced demand. Unless pork prices rise further, its high base in H2 last year implies further decline of y/y food CPI in H2. We forecast CPI inflation will fall below 2% by end-2020.

China's property market used to be extremely cyclical, but those cycles have largely disappeared since 2017. Instead, prices and sales have largely moved sideways. The main reason for this is a fundamental change in the government's approach. The central government no longer treats property policy as a countercyclical tool; its overarching goal has become maintaining housing market stability. It has kept mortgage lending rates high and has delegated most other property policy decisions to city level governments. Local governments are allowed to intervene heavily as long as they are able to maintain price stability. As a result, property cycles have become less synchronized across cities, and national level property cycles have disappeared. More recently, however, the property sector is showing signs of a new cycle. Property sales recovered rapidly from the Covid-19 shock and continued to improve afterwards. In May, propery sales rose 14% y/y in, its highest growth since mid- 2018. Propery prices also edged up: prices in 70 cities rose 0.5% m/m in May. Similar to previous cycles, the property market boom is again led by Tier 1 cities: second-hand property prices increased 1.8% in Beijing and 1.6% in Shenzhen last month.