As China’s steel market enters the new year, the macro environment is poised to seek progress while maintaining stability. With a focus on promoting stability, the domestic demand for steel in 2024 shows signs of cautious optimism. The country is set to witness stronger counter-cyclical and inter-cyclical adjustments in line with the just-concluded Central Economic Work Conference. This entails consolidating and enhancing the positive economic recovery, as proposed by the Political Bureau of the Central Committee. As a result, policy-making departments are expected to increase their efforts in these areas in the coming year.
The proactive fiscal policy is anticipated to be moderately strengthened, including measures such as increasing the fiscal deficit ratio, issuing more bonds, cutting taxes, and reducing burdens. Furthermore, there will be an increase in the investment of central funds in infrastructure. Additionally, multiple cuts in the required reserve ratio (RRR) and interest rates are expected to ensure reasonable and sufficient market liquidity and lower the overall interest rate level. These measures are aimed at providing the necessary support for the steel market and the broader economy.
The indicators related to domestic steel demand are projected to see significant growth in 2024, given the anticipated stronger counter-cyclical and inter-cyclical adjustments, more active fiscal policies, looser monetary policies, and optimized real estate policies. These factors are likely to boost market confidence and have a positive impact on domestic steel demand-related indicators. With the gradual effectiveness of real estate optimization policies, the growth rate of real estate development investment is expected to bottom out, contributing to an overall increase in investment growth.
It is under this macro-control environment of “seeking progress while maintaining stability to promote stability” that the domestic demand for steel in the new year can be cautiously optimistic. The overall situation is expected to be better than the previous year, offering a glimmer of hope for the steel market in 2024. The strategic emphasis on maintaining stability while driving progress is seen as a key driver in the cautious optimism surrounding the market.
However, it is crucial to note that uncertainties and challenges remain. Geopolitical tensions, global economic dynamics, and the ongoing impact of the COVID-19 pandemic could influence the trajectory of the steel market in the coming year. It will be essential for policymakers, industry stakeholders, and market participants to closely monitor these factors and adapt strategies accordingly.
In conclusion, China’s steel market in 2024 is characterized by cautious optimism amidst a backdrop of macroeconomic adjustments. With a focus on seeking progress while maintaining stability, the prospects for domestic steel demand appear promising. The concerted efforts of policymakers to strengthen counter-cyclical and inter-cyclical adjustments, together with proactive fiscal and monetary policies, are expected to create a more favorable environment for the steel market. While challenges persist, the overall outlook for the industry in the new year remains positive.
Post time: Dec-19-2023