JP Morgan's Haibin Zhu spoke to Bloomberg TV earlier after the flurry of PMI data
- Today's PMI figures here are solid
- Economy is still on the right path
- Q2 momentum is still fine, but may slow down in 2H
- External environment for China is getting worse
- Trade woes with the US may be a drag on trade activity
- CNY has been quite stable
- Deleveraging efforts set to continue
- Growth will moderate as a result, but it'll be more sustainable
He's quite on point with some of the key issues faced by the Chinese economy, especially on the domestic front. The key agenda for Chinese president Xi with regards to the financial sector is cutting down risk, and so expect further deleveraging to continue.
This will further impact credit growth (as seen in the M2 money supply report) and all of this weighs on domestic demand, and in turn economic growth.
