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2022-08-04
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Looking at the trend of China's steel price in 2008 from another interest rate hike

looking at the trend of China's steel price in 2008 from another interest rate hike

information on China's construction machinery

Guide: with the central economic work conference setting the tone of the recent monetary market policy orientation, as a product of moderately tight monetary policy, the sixth interest rate hike in 2007 was issued on December 20, 2007, The central bank's interest rate hike belongs to asymmetric interest rate hike: the benchmark interest rate of one-year deposits has been raised by 0.27 percentage points, and the

as the central economic work conference set the tone for the recent monetary market policy orientation, as a product of moderately tight monetary policy, the sixth interest rate increase in 2007 was issued on December 20, 2007. The central bank's interest rate increase is "asymmetric": the benchmark interest rate of one-year deposits was increased by 0.27 percentage points, the benchmark interest rate of demand deposits was decreased by 0.09 percentage points, and the benchmark interest rates of other grades of deposits were adjusted accordingly; The benchmark interest rate of one-year loans will be raised by 0.18 percentage points, the benchmark interest rate of loans over five years will remain unchanged, and the benchmark interest rate of loans of other grades will be raised by 0.09 percentage points accordingly. This is the third time that the central bank has used the method of "asymmetric interest rate hike" since the implementation of "asymmetric interest rate hike" on May 19. As for the impact of this interest rate increase on the steel price trend at present and even in 2008, the author makes a period analysis for you based on some public materials, hoping to make you have a grasp of the steel market price trend at the end of the year and the beginning of the year

reanalysis of the background of interest rate hike

the market expectation of interest rate hike for two consecutive months in the near future has failed, which reflects that the national interest rate hike policy is indeed restricted by some factors. Therefore, the central bank is cautious about the implementation of the interest rate hike policy. At present, the effect of interest rate increase in at least three aspects: economic inflection point, interest rate spread and capital market is not clear

first, will continued interest rate hikes bring about a "hard landing" in economic growth? Take a look at the lessons of the United States. Even if the Federal Reserve continued to raise interest rates slightly and frequently, it still brought about a sudden sub-prime crisis. If China encounters similar risks, the losses will be immeasurable. Especially at present, China's banking industry has just begun its "growth journey", and a bad debt storm may completely undo the hard reform efforts

after all, the current forecast of world economic growth and trade surplus next year is still very uncertain. The impact of the interest rate hike will be much greater than the increase in the deposit reserve ratio. Therefore, the central bank is very cautious about the implementation of the interest rate hike policy

secondly, will the narrowing or even reversal of the interest rate gap between China and the United States bring the risk of hot money influx? The Federal Reserve has cut interest rates twice in a row, and the interest rate gap between China and the United States has narrowed to 0. Below 5%, and the United States may cut interest rates again this week, and the interest rate gap between China and the United States may be reversed at any time. Although the effect of interest rate parity is currently controversial, the annual appreciation of the RMB has been nearly 6%. If the interest rate gap between China and the United States is added, the power of hot money inflow will undoubtedly increase

in fact, since the Federal Reserve cut interest rates for the first time in four years on September 18, the Central Bank of China has not raised interest rates again; In October and November, the inflation situation was severe. From the perspective of easing negative interest rates, the central bank should have raised interest rates. This shows that the "soft constraint" of China US interest rate difference is always a problem

on December 20, the people's Bank of China finally adjusted the RMB deposit and loan benchmark interest rate of financial institutions again, "the one-year loan benchmark interest rate increased from the current 7.29% to 7.47%, an increase of 0.18 percentage points; the deposit and loan benchmark interest rates of other grades were adjusted accordingly". There are three striking features of this interest rate increase: the interest rate of demand deposits has been lowered for the first time, the interest rate of loans over five years has remained unchanged, and the interest rate of provident fund has remained unchanged. The purpose of this interest rate increase is very obvious, that is, to implement the tight monetary policy and recover funds; December 3? The central economic work conference on the 5th just made it clear that the tight monetary policy will be implemented next year; The central bank raised interest rates again at the end of the year, which is consistent with the tight monetary policy; In addition, generally speaking, the policy is relatively stable at the end of the year and the beginning of the year, but the central bank still raises interest rates again at this time, which shows the strength and determination of the government to implement the monetary tightening policy. Therefore, it is expected that the tightening policy next year will still be further strengthened. At the sensitive time point of the end of the current year and the beginning of the year, the central bank has undoubtedly considered carefully. On the one hand, it will increase the cost of short-term loans to curb the bank's lending impulse at the beginning of next year, and on the other hand, it will also increase the interest expenditure on short-term loans to control the investment impulse of local governments

in the answer of the people's Bank of China, the people's Bank of China proposed that in order to guide the public's inflation expectations and give play to the regulatory role of price leverage, the people's Bank of China decided to raise the benchmark deposit and loan interest rates of financial institutions again under the background of rising pressure on domestic price levels and complex international environment. Putting forward the three objectives of raising interest rates is conducive to the implementation of the tight monetary policy; It is conducive to preventing economic growth from being too fast to overheating; It is conducive to preventing prices from changing from structural rise to obvious inflation. In the final analysis, the three benefits are to prevent the rise of inflation expectations

prediction of steel market price trend

the recent sharp rise in domestic steel prices has led to a rise in China's export steel prices. Recently, the quotation for China's hot-rolled coil exported to South Korea has continued to rise. Taking WISCO as an example, the current export quotation for cold-rolled base material is $675/ton (CFR), and that for ordinary hot coil is $655/ton (CFR), up $70/ton and $45/ton respectively compared with the previous period. Other domestic steel mills have also raised their quotations. Japanese JFE and Korean Hyundai hysco and other re rolling mills reached an agreement on the price of cold rolling base material in the first quarter of next year, and the price increased by USD/ton to USD/ton (FOB). At present, the price of cold rolling base material in China is much higher than that of Japanese resources. The domestic prices of some steel products have been close to or higher than the current prices in the international market. In addition, due to the appreciation of the RMB, the export enthusiasm of domestic steel mills is much lower than before. Based on the analysis of the actual situation of the current international market, this situation will not change significantly in the short term. Therefore, the domestic steel export situation in 2008 is certainly not as good as this year. This has been proved by the steel export statistics in recent months, As the domestic steel price continues to run at a high level, the low-cost resources in the international market will concentrate on impacting the domestic market for a certain period of time, which needs to be taken seriously. From this point of view, it is not entirely beneficial for domestic steel production enterprises to keep the market price of domestic steel and shrinkage rate at a high level

due to the bank controlled loan at the end of the year, the capital of steel traders is generally tight. Recently, with the gradual recovery of the stock market, the role of capital withdrawal is also gradually strengthened. From now to the beginning of next year, with the tightening of capital, the enthusiasm for speculation in the steel market will be restrained. For the traditional steel distribution mode, an annual distribution agreement will be signed with the steel plant at the beginning of the year, According to the annual agreed quantity, the company pays a deposit of varying quantities to obtain the distribution qualification of the steel plant. Then, according to the actual market situation of the month, the steel plant delivers goods according to the increment or reduction. In fact, the pricing right or the quantitative right of delivery are all in the steel plant. The traders can only passively accept it, but can not maximize the profits according to the changes of the market. This is the weakness of the traditional steel marketing model. In fact, the current rising steel prices are not recognized by traders, because with the rising steel market prices, the ordering funds and margins also rise, and the capital turnover rate is actually declining. Steel mills can transfer profits by adjusting the ex factory steel prices, and traders often work for steel mills. Therefore, there is time, especially at the sensitive time nodes of ordering at the end of the month and the end of the year. Traders ship at low prices. They would rather lose money than lower the transaction price in the spot market. By lowering the transaction price in the spot market, the adjustment range of the ex factory price of steel mills can be controlled. From this point of view, Mechanical function test is the most important test in steel mills. 1. The price game with traders often leads to irrational ups and downs of market prices. At present, the problems of scattered, disorderly, weak and small steel trading enterprises in China are quite prominent. There are more than 100000 steel circulation enterprises in China, but the scale is very small. In Shanghai alone, there are more than 6000 enterprises engaged in steel trade, but the business scale is not large. The annual sales volume is 10000 tons, which is very large. However, Japan's steel output is only about a quarter of that of China, but its midawang company has an annual sales volume of 25million tons, which is 10million tons larger than that of China's Minmetals Group

a single trader cannot compete with the steel mills that are relatively in a monopoly position. Therefore, the current traders' views and operations on steel trade are short-term and not systematic

both traders and steel mills do not support the current steel price soaring again. What factors have the greatest impact on the steel price trend in 2008? According to the author's personal point of view, the trend of steel prices in 2008 must have the greatest correlation with the current rising inflation. As far as the current steel price is concerned, the impact of favorable factors such as rising costs and adverse factors such as shortage of funds on steel price is basically the same, and the impact of adverse factors prevails in the short term. If inflation is out of control, steel price will inevitably rise again in the short term, but the probability of this kind of possibility is small

in 2008, the steel price was basically in a stable rising channel. Due to the moderate inflation, the production cost of steel will rise sharply. However, the difference between the current steel price and the production cost has been widened. The increase of production cost of steel can be digested inside the steel plant. It is not feasible to transfer the cost pressure to downstream enterprises again. For specific steel products, in 2008, the growth rate of infrastructure investment and real estate investment was limited due to the impact of tight regulation and control policies. The price increase of low-end steel products, such as rebar and glass ball gb18428 ⑵ 001 for hot coil automatic fire extinguishing system, must be limited, but the relatively high-end steel products, such as cold rolled sheet and galvanized sheet, are likely to be driven by the increase of downstream consumption due to the impact of consumption upgrading, Especially for cold rolled steel, there is a great market opportunity in 2008

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