Three consecutive sounds of financial benefits: the spring of the construction machinery industry has arrived

In the first half of 2024, the sales of major construction machinery products showed a trend of stabilizing at the bottom, with a cumulative sales of 968900 units domestically and internationally, a year-on-year increase of 4.58%. It is expected that the overall economic operation of the construction machinery industry in the second half of the year will continue to maintain a stable recovery and steady progress trend. The gears of fate will shift to September 2024, and the adjustment of domestic and international financial policies will undoubtedly be a shot in the arm for China's construction machinery industry, which currently relies on funds and exports.

1. Federal Reserve cuts interest rates

On September 18th local time, the Federal Reserve announced a 50 basis point reduction in the target range for the federal funds rate. This is also the first time in four years that the Federal Reserve has lowered interest rates. Analysts from Wells Fargo pointed out in a report that the recent interest rate cuts by the Federal Reserve are just the beginning of a series of rate cutting measures that are expected to stimulate broader market opportunities in 2025.

2. The exchange rate of RMB to USD has broken 7

Under the influence of the Federal Reserve's interest rate cut and a series of important domestic policy announcements, the RMB exchange rate broke through the key point of 7.0 on September 25th. Specifically, on the morning of the 25th, the offshore RMB/USD exchange rate recovered from the 7.0 mark during trading, reaching a high of 6.9993, marking the first time since May 2023.

3. Reserve requirement ratio cuts by the central bank

The People's Bank of China announced on September 27 that it would cut the deposit reserve ratio of financial institutions by 0.5 percentage point (excluding financial institutions that have implemented a 5% deposit reserve ratio). After this reduction, the weighted average reserve requirement ratio for financial institutions is about 6.6%.

The central bank's reserve requirement ratio reduction and the introduction of a combination of financial policies by multiple departments to support economic development are considered by industry insiders to be the implementation of the requirements of the Central Politburo meeting, fully reflecting the strong confidence of monetary policy to support stable growth.

4. Policy benefits brought by the "three consecutive sounds"