As the Chinese leadership prepares to set the economic agenda for the year ahead, analysts expect Beijing to mostly maintain this year’s policy tone but say it could tolerate a slightly lower growth target. Growth of ‘around 5 per cent’ may be revised to between 4.5 and 5 per cent. The leadership is gearing up for a tone-setting conference.
The Chinese leadership is preparing for the central economic work conference to set the tone for 2026 economic policies. Analysts expect Beijing to continue this year’s policy direction, including a proactive fiscal policy and moderately loose monetary policy, to address demand weakness and local governments’ fiscal difficulties.
Lu Ting, chief China economist at Nomura, said in a report released on Thursday: “To address the demand slump, we expect Beijing to maintain its proactive fiscal policy stance, with a near-term priority of alleviating local governments’ fiscal difficulties.” He added that while supportive measures for the still declining property sector could be introduced, markets “may need to lower their expectations.” Lu noted: “Beijing has yet to find more effective solutions that can be executed decisively to address the causes of the property collapse since 2021.”
Analysts at ANZ Bank also anticipate a “more proactive” fiscal policy and a “moderately loose” monetary policy, in line with this year’s stance. These expectations highlight challenges such as deflation, trade war impacts, and unemployment, but the policy focus remains on stabilizing growth.
The conference, typically held in December, will guide the National People's Congress in March. Analysts stress that while the target may be slightly lower, the overall strategy will maintain continuity to support economic recovery.