According to data from the National Bureau of Statistics, my country's GDP in 2022 will increase by 3% compared with last year. It can be seen that China's macroeconomic growth will be significantly accelerated this year, and its growth rate may be about double that of last year.

The significant acceleration of China's macro economy is the biggest factor affecting the steel demand situation this year. This is because, for China's current economic and technological structure, there is a positive correlation between macroeconomic growth and consumption of energy and raw materials, including steel consumption. The higher the speed of the former, the greater the consumption of the latter. In the case that China's economy is still based on manufacturing, it is still difficult for us to achieve the reduction of total energy and raw material consumption to support the accelerated growth of the total economy, especially the multiplied growth.

Under its relatively optimistic forecast, China's manufacturing purchasing managers index (PMI) in January this year returned to the expansion range after shrinking for three consecutive months, up 3.1% from the previous month. Judging from the leading indicators of fixed asset investment, the planned total investment of newly started projects in 2022 will increase by 20.2% compared with last year, and the invested capital (excluding real estate development investment) will increase by 21.8%, which provides a strong guarantee for the continuous and stable growth of national investment in 2023.

Therefore, China's total steel demand in 2023 will show a phased growth trend, and the growth level will increase with the significant acceleration of the macro economy. The significant acceleration of China's economic growth in 2023 has also become the most important engine for the global economy. China's macro-control to accelerate economic growth will significantly reduce the possibility of global economic recession and contribute to global economic growth. At the same time, the Fed and other central banks in western countries are drawing to a close in raising interest rates.

Different from the monetary policy in 2022, the focus of whether the Fed will raise interest rates has shifted from simply suppressing price increases to controlling the balanced relationship between prices and economic growth. It is expected that the direction of its monetary policy in the future will mainly shift to avoid economic recession, at least to avoid a severe economic recession. In this way, there is also the possibility that the Fed's monetary policy will shift in the second half of this year and return to the channel of interest rate cuts.

Affected by it, it is expected that the world economic growth in 2023 may also exceed expectations, and the external environment for China's steel demand will not be too bad. It is expected that as the high inflation rates in Europe and the United States fall, the turning point of overseas inventory will appear in the second quarter, resulting in the recovery of overseas demand in the second half of the year. Therefore, China's steel exports in the second half of this year are relatively optimistic, which is better than that in the first half of the year. Therefore, it is expected that in 2023, China's steel exports, especially the indirect exports of steel products driven by the export of mechanical and electrical products, will remain resilient, and their export situation will also exceed expectations. The strong resilience of China's steel demand, of course, also provides a solid growth base for its domestic production.