Morgan Stanley Fixed-China Economics Bull vs. Bear Summer Remains Indecisive-108792207

MIdeaChinaEconomics|AsiaPacificBullvs.Bear:SummerRemainsIndecisiveMorganStanleyAsiaLimitedRobinXingChiefChinaEconomistRobin.Xing@morganstanley.com+8522848-6511JennyZheng,CFAEconomistJenny.L.Zheng@morganstanley.com+8523963-4015ZhipengCaiEconomistZhipeng.Cai@morganstanley.com+8522239-7820HarryZhaoEconomistHarry.Zhao@morganstanley.com+8522239-7229Growthimbalanceworseneddespitestableheadlines:strongshippingpricesonexports,butJunee-commercesalesappearlackluster.PBoCimprovescommunicationswhiledownplayinghopeofratecuts.Tobringyouavarietyofperspectives,wehavepickedseveralchartsthatconsiderbothbullandbearargumentsforChina'seconomyinourbiweeklychartbook:•Bullarguments:CyclicaltailwindstoexportsappeartobesustainedinJune,andweseecapitalgoodsasamedium-termstructuraltailwindamidsupply-chainderisking.Supplychaincompetitivenessnolongerhingesoncostadvantage;instead,technologicalprogressamidrisingR&Dhasbecomethebedrock.TherehasalsobeenasubtleandslightlypositivedevelopmentinresolvingLGFVrisks.•Beararguments:ConsumptionwassubduedinApr-Mayandcouldsoftenfurtheramidacceleratinghousingpricedecline.Earlydatafor"618salespromotion"isdisappointing.Forimportantdisclosures,refertotheDisclosureSection,locatedattheendofthisreport.June20,202411:25PMGMTMIdea2MIdeaMorganStanleyResearch3BullArgumentsMIdea4ExportStrengthIsLikelySustainedinJune...