(BLOOMBERG) – China's economy continued to weaken in June, with the slowdown underscoring how important it will be for President Xi Jinping to push forward talks with President Donald Trump this week and avoid tariffs on the rest of the nation's exports to the U.S.
The deterioration is reflected in a Bloomberg Economics gauge aggregating the earliest available indicators of business conditions and market sentiment. The small businesses outlook worsened from May, with trade tensions weighing on future sales. Property stocks, South Korean exports and factory inflation all pointed to the downside, while major Chinese stocks, iron ore and copper prices improved.
The fragile economy gives Xi a less upbeat backdrop for the negotiations than his counterpart. The government and central bank have tried to funnel stimulus to smaller companies and the private sector, but they will face much more immediate pain than the large and state-owned firms if the meeting goes sour and the nation's exporters face a 25% tariffs on everything headed for the U.S.
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