The US-triggered trade war has hurt China's exports, increased uncertainty and dampened business investment in 2019. 

And since the US-China trade war seems likely to last longer, Chinese policymakers may also want to keep some policy reserves for the future.

Therefore, we do not think the government will strive to achieve 6 percent growth in 2020 at all costs. If the US makes good its threat to raise tariffs on more Chinese goods on Dec 15 and brings stronger headwinds for the economy, we think the Chinese government can accept a sub-6 percent growth in 2020. But if the US suspends the tariff hike, the expected modest policy easing should get growth close to 6 percent.

Despite the expected slowdown in 2020, we do not foresee a significant drop in China's consumption growth. Ongoing structural transformation, including a gradual move toward services, and more automation in the manufacturing and export sectors, means the negative effects of higher tariffs and weaker exports have had only moderate impact on the labor market. 

Moreover, given the largely resilient labor market, recent income tax cuts, and the government's initiative to support the service sector and small and medium-sized enterprises, we see consumption slowing only modestly next year. In particular, car sales could stabilize and become less of a drag on the economy.

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