China signals it will rely on fiscal stimulus to manage economy in 2026
Beijing pledges elevated deficits and debt to sustain growth amid trade tensions.
China
CN signaled on Thursday it will rely on fiscal stimulus to manage the economy in 2026, pledging to maintain a "necessary" budget deficit and debt levels to shore up growth while tackling local government financial strains. The commitment, outlined after a key agenda-setting meeting, underscores Beijing's intent to keep spending high and deploy flexible monetary tools as it faces pressure to boost domestic demand and offset global trade tensions.
CN signaled on Thursday it will rely on fiscal stimulus to manage the economy in 2026, pledging to maintain a "necessary" budget deficit and debt levels to shore up growth while tackling local government financial strains. The commitment, outlined after a key agenda-setting meeting, underscores Beijing's intent to keep spending high and deploy flexible monetary tools as it faces pressure to boost domestic demand and offset global trade tensions.China will increase counter-cyclical and cross-cyclical adjustments next year, the official Xinhua news agency reported, citing the annual Central Economic Work Conference held December 10–11. "We will continue to implement a more proactive fiscal policy: maintain necessary fiscal deficit, total debt scale, and total expenditure, strengthen scientific fiscal management, optimize fiscal expenditure structure," it said.
