Core Viewpoint - The ongoing trade tensions are causing a slowdown in economic growth in Asia, with low-income economies facing particularly severe impacts, although major economies like China have significant domestic demand potential [1][2] Group 1: Economic Growth Forecast - The IMF has revised its economic growth forecast for the Asia-Pacific region to 3.9% for this year, a decrease of 0.5 percentage points from previous estimates due to escalating trade tensions and tightening financial conditions [1] - The IMF warns of economic downside risks, citing rising uncertainty, further tightening of financial conditions, and persistent weak external demand as potential factors for more severe negative impacts on the region's economy [1] Group 2: Policy Recommendations - The IMF suggests that Asian economies should pursue structural reforms to enhance domestic demand and create a balanced development model that emphasizes both internal and external demand [2] - The IMF encourages Asian economies to stimulate consumption and boost private investment to foster a more balanced growth pattern [2] - The importance of deepening regional economic integration is emphasized, with significant trade growth potential among Asian economies [2] Group 3: Trade Agreements - The IMF highlights the benefits of clear, stable, and predictable trade environments, advocating for pragmatic and constructive agreements, whether regional, cross-regional, or bilateral, to stimulate growth through exports [2]

Investment Rating - The report maintains an "Overweight" rating for the consumer discretionary sector [7] Core Insights - The escalation of tariffs is reshaping global supply chains, leading to a structural impact on China's exports, while domestic demand is expected to benefit [1][11] - Companies with high domestic sales ratios are positioned to capitalize on the emerging opportunities in the local market as domestic brands continue to rise [1] Summary by Sections Home Appliances - Major home appliance companies like Haier are leveraging localization and production in Mexico to mitigate tariff impacts, thereby strengthening their market share in the U.S. [2][15] - The black appliance sector is seeing a shift towards Mexican production to buffer supply chain pressures, with companies like Hisense and TCL benefiting from cost control [2][16] Cleaning Appliances - The U.S. market remains highly dependent on Chinese manufacturing for cleaning appliances, with significant price increases expected due to high tariffs on imports from China and Vietnam [3][20] - Chinese companies are rapidly iterating products to gain market share in the U.S., with brands like Roborock surpassing local competitors in revenue [25][26] Light Industry and Home Furnishings - Southeast Asian production is likely to face challenges due to increased tariffs, but Chinese companies are actively seeking to adapt by expanding export regions and enhancing price transmission capabilities [4][29] - The reliance on the U.S. market for home furnishings has decreased, with exports expected to recover post-tariff adjustments [30][31] Cross-Border E-commerce - The supply chain disruptions are evident, but the competitive landscape may improve as smaller sellers face greater pressure due to the cancellation of the $800 tax exemption policy [5][39] - Major players are expected to benefit from market share consolidation as smaller competitors exit the market [40][41]