China Macro:May data preview,Slowdown continues

China’s economy started accelerating from 1Q16 and peaked in 1Q17. It hasdecelerated since then and the trend continued into May. That said, theslowdown is a modest one and GDP growth in 2Q17 is on track for 6.7% yoy.

    As such, the next couple of months will remain a window for policy makers todeleverage the financial system. The focus of policy makers will shift tosupporting growth sometime in 3Q17, when the slowdown threatens the 6.5%bottom line growth rate.