China: Leading indicators show signs of peak in Q1 - Danske Bank

According to analysts from Danske Bank, there are more signs of a peak in the cycle in China for some time. They expect a slowdown during 2017. 

Key Quotes: 

“Chinese leading indicators have pointed to a peak in the cycle for some time. The recent round of PMIs confirm the peak is likely taking place in Q1.”

“We look for a moderate slowdown during 2017 as the leading indicators support: 1. Slowing housing market 2. Fading boost from infrastructure”

“Exports serve as a buffer as they are underpinned by (a) stronger global growth and (b) a weaker CNY. However, if US cycle peaks the tailwind could fade a bit here too.”

“Main risk is a trade war with the US, which has a fairly high probability in our view.”

“Monetary policy has been tightened and we look for a moderate further tightening aimed at stemming housing and leverage.”