Sealand: Top 10 Key Words for 2025

Sealand has released the top ten keywords for 2025. The company stated that the current market is experiencing three major turning points and two inflection points. The turning points are the gradual shift of the policy focus from the supply side to the demand side, the implementation of major reforms determined by the Third Plenum to increase risk preference, and a balance between macro-control flow and stock thinking. The inflection points are the loose resonance of monetary policies between China and the US, and the dual loosening of fiscal and monetary policies domestically. Overall, the outlook for artificial intelligence is positive, with the upstream of the industry chain already taking the lead. In the second half of 2024, there were more catalytic developments on the application side, and commercialization progress showed signs of acceleration. The Central Economic Work Conference in December highlighted "AI +" on the policy front, focusing on the development process of AI empowerment in downstream fields in 2025. The top ten keywords for Sealand in 2025 are as follows: 1. Export pressure: Due to the slowdown in emerging economies and the imminent arrival of "Trump 2.0," it is predicted that China's exports may face certain downward pressure in 2025. 2. Consumption-driven: Stimulating consumption is expected to be a top priority in 2025. China will focus on improving social security, supporting special groups (such as university students), and promoting consumption upgrade through measures like "trade-in old for new," aiming to boost consumer confidence. 3. Era of low interest rates: Referring to the drastic decline in policy interest rates during the burst of Japan's economic bubble in the 1990s, China also faces a situation trapped in supply and demand, requiring a low-interest-rate environment to support the downward economic cycle in 2025. 4. Devaluation pressure: The exchange rate of the Renminbi may come under pressure again in 2025. On one hand, the Renminbi's exchange rate has fluctuated broadly since 2018-2019 due to the implementation of trade measures and the easing in China-US negotiations, providing a reference for the future. On the other hand, the economies of non-US countries are mostly experiencing weak recoveries, and China's "endogenous" momentum remains weak. 5. Fiscal and monetary loosening: In October 2024, the Ministry of Finance stated in a press release that there is still ample room for central government deficits to increase, initiating a new cycle of fiscal and monetary loosening. On the fiscal side, the broad fiscal deficit rate is expected to increase to 8.8% in 2025, and total general fiscal expenditure is estimated to exceed 12 trillion yuan. On the monetary side, there is hope for a continuation of the reserve requirement ratio reduction and interest rate cut cycle. 6. Shift in focus from investment to consumption: The Central Economic Work Conference in December 2024 placed "vigorous boost to consumption" as the top priority for the year, shifting the policy focus from investment to consumption. In the short term, the policy of trading-in old for new consumer goods is expected to be strengthened, and support areas are likely to expand. In the long term, there will be an increased emphasis on livelihood security, and policies related to childbirth and retirement. 7. Valuation-driven: Performance driving is relatively average in 2025, with valuation driving becoming more important. The valuation repair cycle that started in 2024 is expected to continue, with drivers coming from the equity-debt price ratio and loose policies. 8. Bull market scenario: The current market is experiencing three major turning points and two inflection points. The turning points are the gradual shift of the policy focus from the supply side to the demand side, the implementation of major reforms determined by the Third Plenum to increase risk preference, and a balance between macro-control flow and stock thinking. The inflection points are the loose resonance of monetary policies between China and the US, and the dual loosening of fiscal and monetary policies domestically. 9. Artificial Intelligence +: The overall outlook for artificial intelligence is positive, with the upstream of the industry chain already taking the lead. In the second half of 2024, there were more catalytic developments on the application side, and commercialization progress showed signs of acceleration. The policy highlighted "AI +" at the Central Economic Work Conference in December, focusing on the development process of AI empowerment in downstream fields in 2025. 10. Expansion of consumption: The trade-in old for new policy has already shown initial effectiveness, and policies emphasizing consumption promotion have increased. In December 2024, the Central Economic Work Conference placed vigorous boost to consumption as the top priority for 2025, with policy scope and intensity expected to increase. Additionally, attention is being paid to "new consumption" concepts such as ice and snow economy and emotion economy. Risk Warning: Possible risks include unexpected global economic fluctuations, uncertainties in US policies such as tariffs and monetary issues, escalating geopolitical disturbances, unforeseen changes in China's macroeconomic policies, unexpected changes in price levels, potential biases in understanding policies, slower-than-expected progress in industrial policy implementation, potential biases in related calculations, and historical data serving as references only.