China May Use Yuan if Spat Becomes Full-Blown Trade War, UBS Says

The transcript discusses the potential impacts of a trade war on China's economy, focusing on exports, currency depreciation, and market pressures. It highlights the importance of monitoring specific metrics to gauge economic impact and explores second order effects on investment and growth. The discussion also covers the implications of tariffs and potential policy responses to mitigate economic downturns.

What could trigger a full-blown trade war according to the discussion?

• High double-digit tariffs and non-tariff measures

• A minor increase in tariffs

• A rise in the renminbi value

• A decrease in exports

What is the role of the renminbi in the context of the trade war?

• It is being actively depreciated by the government

• It is unaffected by the trade war

• It is being allowed to depreciate due to market pressures

• It is being appreciated to counter tariffs

Which metric is NOT mentioned as a way to gauge the impact of the trade war on China's economy?

• Export levels

• CapEx investment decisions

• Tourism rates

• Wage growth

What is the expected impact of a 25% tariff on $250 billion worth of Chinese exports?

• A growth decrease of 2 percentage points

• No impact on growth

• A growth decrease of 0.8 percentage points

• A growth increase of 0.8 percentage points

How might policy easing at home affect the impact of the trade war?

• It will worsen the impact

• It will partially offset the impact over time

• It will have no effect

• It will fully offset the impact