China's Growth Is Slowing Down 'With Huge Divergence,' UBS Investment Bank Says

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00:00The bottom line here is that the growth is slowing down, but with huge divergence,

00:04which means, as we can see from data, the exports and industrial production big expectation,

00:09but domestic economy, like retail sales, investment, are slowing down. So that's a

00:15very interesting picture from Q3. Okay, is there anything we can glean

00:20from the data now in terms of what policymakers' future response might be,

00:24to your point, a slowdown that seems to be accelerating overall?

00:28Yeah, sure. The policy momentum is set to accelerate because now year-to-date growth

00:33will be around maybe 5%, but the Q4 growth will be more challenging than Q3. We believe

00:40there will be further deceleration in Q4, possibly close to 4% growth, which means

00:46the annual growth target of around 5% may be jeopardized. That's why possibly the

00:52government need to prepare something new, policy stimulus, to offset the

00:57headwinds from domestic economies, to make the growth targets more achievable.

01:01Won't exports offset that weakness? Do you think exports will be able to bridge the gap?

01:10Frankly speaking, exports has been very robust year-to-date, 6-plus growth, right? But Q4, we will

01:17have the high base effect. Last Q4, we have 10% export growth. And also in terms of payback of

01:25the front loading previously, and even with some renewed uncertainties from US, China, France,

01:31I believe exports may decelerate. It's not good enough to fill the gap. So that's why it's still very

01:37challenging. Is that going to be when we see the fourth quarter, the payback from the front loading? Or is

01:43there something else going on when you're seeing these robust export numbers? Yeah, there's some

01:47ongoing payback from loading previously. But clearly, if you look at the data elsewhere, from

01:53Asia, from Europe, even from US, global growth actually has been a little bit better than previously

01:59expected. That's resilience, I believe, where we come from.