Not Another False Start

Despite poor Q2 data, TS Lombard expects a modest, investment-led recovery in China during H2 2026. This presents a tactical buying opportunity for select Chinese equities and CNY long positions.

Key Takeaways

• 1.The weakness in recent China data is overstated and driven by cyclical factors rather than structural collapse.
• 2.Q2 weakness is consistent with historical seasonality in China, compounded by energy shocks and fiscal policy gaps.
• 3.Anticipated policy 'fine-tuning' by the July Politburo and accelerating bond issuance should support a recovery.

Table of Contents

• Not Another False Start

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