China: Onshore views and risks - Nomura
According to analysts at Nomura, China’s Growth is forecast to slow in 2018 with targeted deleveraging, but systemic risks are expected to be contained.
“The property sector is expected to slow, but financial risk concerns have fallen.”
“The internationalisation of RMB is intact, but the current bias is more towards inflow policies and controls on outflows.”
“WGBI inclusion is unlikely in the next three months, but possible over the next 12 months.”
“Local diversification into foreign assets has continued, but there is a risk of a pickup if there is macroeconomic weakness.”
“The change in the PBoC governor should not alter reform momentum and rate hikes are unlikely in 2018 with inflation expected to be under control. Recent bond market volatility is not seen as a concern.”
“Big risks for 2018 include North Korea and US President Trump’s policies. The concern is if there is a concerted push to deleverage.”