China’s Economy Poised for Steady Growth
China’s economy is expected to continue its steady growth momentum into 2026, driven by increased policy support for domestic demand and a faster transition to innovation-led growth. This will help cushion the economy against any external uncertainties, according to officials and analysts.
Economic Outlook
Monetary policy is set to provide continuous and targeted support for China’s economic transition. Recent moves to adjust structural tool rates and quotas highlight the focus on supporting key sectors. The country’s 2025 economic data, to be released on Monday, is expected to show a GDP growth of around 5 percent, outperforming earlier expectations and demonstrating the economy’s resilience.
Key Drivers of Growth
According to Zou Lan, vice-governor of the People’s Bank of China, the country’s super-large market and complete industrial chain will support its economic growth. The integration of scientific and technological innovation with industrial innovation is accelerating, and new growth drivers are gaining momentum. Domestic demand potential continues to be unleashed, and domestic and international circulation are running more smoothly.
Policy Support
The central bank has announced a cut in rates on targeted policy tools, effective from Monday, and will expand related quotas to boost lending in key areas. This includes setting aside 1 trillion yuan ($143.4 billion) in central bank lending quota to support small and medium-sized private firms. The central bank vice-governor has also signaled a readiness to introduce broad-based easing measures, including cuts to interest rate benchmarks and reductions in the reserve requirement ratio.
Business Confidence
Kelly Zhang, general manager of Bimbo China, believes that domestic consumption in China will gradually recover, giving the company confidence to deepen its investment in the country. This will help speed up geographic expansion and category expansion in the market. Analysts also expect the central bank’s policy messages to address structural challenges through targeted support for technological innovation, private businesses, and efforts to expand domestic demand.
Conclusion
In conclusion, China’s economy is poised for steady growth in 2026, driven by policy support, innovation-led transition, and increasing domestic demand. With the central bank’s emphasis on keeping overall financing conditions relatively accommodative, the likelihood of further easing measures is rising. As the country enters the 15th Five-Year Plan period, its solid economic outlook is expected to support the renminbi exchange rate and attract further investment from businesses.
