Main viewpoints

1. Consumption will be disturbed in the short term after the epidemic prevention adjustment, but recovery is the general trend.

Overseas experience shows that after the adjustment of epidemic prevention policies, the economy has mostly shown a trend of recovery, partly because of macro-policy stimulus, and on the other hand, due to endogenous improvement. Relatively speaking, the economic performance of economies with relatively late and well-prepared epidemic prevention policies will be more stable. The consumption performance after the adjustment of epidemic prevention shows commonness in three aspects:

After the adjustment of epidemic prevention policy and the stable epidemic situation, ► consumption showed a trend of recovery. The path of consumption recovery varies from economy to economy, but the general direction of improvement is the same. Consumption levels in most economies have rebounded significantly from their lows during the epidemic, and consumption in some economies is already significantly higher than before the epidemic. For example, 3Q22's personal consumption expenditure in the United States has reached 107.1% of 4Q19.

The agglomeration and contact service consumption of ►, which was suppressed by the epidemic, has the greatest flexibility in repair. With the adjustment of epidemic prevention and scene repair, areas that are more affected during the epidemic tend to be more flexible. From the perspective of representative economies such as Britain, the United States, Japan and South Korea, the growth rate of service consumption compared with the low during the epidemic exceeds the improvement of commodity consumption. For example, the rebounding rate of service consumption in Japan and South Korea is more than 5 percentage points higher than that of goods.

The ► epidemic will rebound periodically, but the strength of the rebound and its impact on consumption generally tend to weaken. The impact of the epidemic is not an one-off. The United States has experienced a rebound of seven outbreaks since 2020, with an average of one in four to six months, and other countries have similar characteristics. Repeated epidemic situation will have a certain impact on consumption, but on the whole, it shows a weakening trend, especially the impact of Omicron epidemic is smaller.

2. Transportation: the recovery of travel demand consumption may lead to high growth of aviation performance.

Short-term air travel demand is still at a low level, with the continuous optimization of epidemic prevention and control measures, the backlog of travel demand is expected to recover quickly, the aviation industry is expected to form a gap between supply and demand, reflecting high performance elasticity. In the medium and long term, the supply, demand and pattern of the aviation industry have improved compared with those before the epidemic. International travel demand is also expected to recover, which is good for airport performance repair.

3. Tourism, hotel and catering: considerable space in the medium and long term; twists and turns in the path

In the short term, winter is the season with high incidence of virus infection, and consumers' willingness to travel and consumption may take time to adjust. There is still some pressure on the recovery of tourism, hotel and catering consumption data, and the recovery path may be tortuous. In the medium to long term, the upgrading of consumption and yearning for a better life are still the trend of the times, and the industry is expected to pick up growth again. In the competition pattern, most leaders have achieved a certain degree of counter-trend to expand stores, increased market share, and under the stress test to increase revenue and reduce expenditure, hone internal skills, and accumulate strength for future recovery.