China Outlook 2019 – Stimulus offsets trade risks

• 2018 marks the resumption of China’s gradual slowdown
  … driven by financial deleveraging and initial drags from trade conflict US
• Trump and Xi Jinping agree on 90 day truce in Buenos Aires
• Should downside pressures intensify, Beijing has more room for stimulus
• Yuan weakness also cushions impact tariffs, but we expect some recovery
• All in all, we expect China’s slowdown to remain gradual in 2019 and 2020

• Main risks: tensions with the US, other geopolitical risks, high debt levels