China’s annual central economic work conference is set to convene this week

China’s annual central economic work conference is set to convene this week

• Chinese leaders will convene for up to three days
• its a closed-door conference
• will set out next year’s major policy goals and concrete tasks
• during the central economic work conference.
• its attended by hundreds of high-ranking officials, including ministers, the central bank governor, provincial governors and executives of state-owned financial and industrial giants

The meeting will assess domestic challenges, including

• a weak property market,
• local government debt,
• low investor confidence,
• high youth unemployment,

while preparing for external pressures like US tariffs under Trump’s second term.

Policymakers aim to stabilize growth with intensified support, emphasizing fiscal adjustments, reforms, and measures like social security changes, hukou system reforms, and a private economy promotion law to boost business confidence.

• Despite recent supportive policies, there’s skepticism over additional fiscal stimulus, with concerns of market disappointment. Expectations include a stronger fiscal deficit (up to 3.5% in 2025) and enhanced countercyclical measures.

• Central bank promises include supportive monetary policies, ensuring liquidity, lowering financing costs, and stabilizing property and capital markets.

• Stabilizing the property sector is seen as crucial for driving consumption and economic stability, with longer-term measures prioritized over short-term boosts like consumption vouchers.

• While Trump’s tariff threats loom, weak domestic demand and financial stability risks are expected to have a more significant impact on China’s economy in 2025.

Specific economic targets will be set at the National People’s Congress in March.

Earlier:

• Fitch has slashed its 2025 and 2026 China economic growth forecasts

This article was written by Eamonn Sheridan at www.forexlive.com.