Ten chief economists interviewed by Jiemian News expect China's economic recovery to extend into 2026, with prices edging up modestly and real GDP growth hovering around 5.0% for the year. They see China–U.S. trade frictions and ongoing property sector adjustments as the two biggest macro risks.
Photo from CFP
by WANG Zhen
China delivered a "stable with improvement" performance in 2025. GDP expanded 5.2% year on year in the first three quarters, laying a solid foundation for achieving the full-year growth target of around 5%.
Looking ahead to 2026, the economists said policy priorities would remain focused on boosting domestic demand and strengthening industry. Subsidies for consumer goods trade-ins are expected to be no less than this year's 300 billion yuan, with support for services consumption likely to expand further. Industrial policy, they added, will continue to emphasize technological self-reliance, using innovation to drive industrial upgrading.
On fiscal and monetary policy, most economists expect the headline fiscal deficit ratio to be set at about 4.0% in 2026, unchanged from 2025, alongside a modest increase in issuance of ultra-long special treasury bonds and new local government special bonds. A majority foresee one to two interest-rate cuts over the year, totaling 10 to 20 basis points, and a single cut in the reserve requirement ratio of about 50 basis points.
The economists interviewed by Jiemian News were LIAN Ping, chairman of the China Chief Economist Forum; ZHANG Jun, chief economist at China Galaxy Securities; LUO Zhiheng, chief economist at Yuekai Securities; XIONG Yuan, chief economist at Guosheng Securities; ZHAO Wei, chief economist at Shenwan Hongyuan Securities; LU Zhe, chief economist at Soochow Securities; SONG XueTao, chief economist at Sinolink Securities; WU Chaoming, chief economist at Chasing Financial Holdings; YANG Delong, chief economist at First Seafront Fund Management; and XING Ziqiang, chief China economist at Morgan Stanley.
Median forecasts from the group put 2026 GDP growth at 5.0%. LIAN said a target around that level would help ensure a smooth start to the 15th Five-Year Plan period. With an improving global environment, exports are likely to maintain medium-pace growth and support industrial output, while policy backing should underpin consumption and lift investment, including a normalization of infrastructure spending. He added that the property market is likely to continue bottoming out, with overall risks manageable.
LUO also expects growth of about 5.0%, hinging on developments in property and local government debt, with exports and centrally backed infrastructure investment providing key support. He sees a "U-shaped" growth path through the year, with a strong start, a mid-year slowdown, stabilization in the third quarter and a policy-driven pickup toward year-end.
ZHANG anticipates a front-loaded then easing trajectory, with quarterly growth of 5.2%, 5.0%, 4.9% and 4.8%, as policy support that was relatively subdued in the second half of 2025 gains traction and becomes more visible in the early part of next year.
SONG said economic transformation would remain the main theme, with resilient exports and inertia in the property adjustment shaping underlying momentum, while policy timing linked to the new five-year plan could result in a V-shaped pattern over the year.
The economists broadly agreed that China–U.S. trade frictions and the domestic property downturn remain the largest sources of uncertainty. WU said risks stem from the interaction of external geopolitical uncertainty and internal strains from property and local government debt, which could amplify one another. LU highlighted export stability as the main variable, noting that while markets are not overly pessimistic, higher global tariffs and the absence of front-loading effects could weigh on shipments.
Official data show China's exports, measured in U.S. dollars, rose 5.4% year on year in January–November 2025, matching the pace a year earlier and exceeding expectations despite trade tensions. LUO said China's exports should remain resilient, supported by industrialization in emerging markets, rising global investment in AI computing power, firms' overseas expansion and China's strong position in mid- and upstream manufacturing. ZHANG argued that the external environment in 2026 could be more favorable than in 2025, with reduced trade uncertainty and potential support from U.S. monetary easing.
China's property sector remains in deep adjustment. Official data show property development investment fell 15.9% year on year in the first 11 months of 2025, a steeper decline than for the full year of 2024. Most economists expect the downturn to persist into 2026, though with narrowing declines.
XIONG said the market is likely to see a prolonged bottoming phase rather than a clear reversal, as high inventories, ample supply and household deleveraging continue to constrain demand. Still, earlier easing measures are gradually taking effect, and declines in sales and prices may moderate, with policy support and demand resilience in core cities providing some buffer.
WU said international experience suggests that a sustained recovery requires volumes to stabilize before prices, inventories to return to normal levels, and income growth to improve affordability—conditions that will take time to materialize. SONG, by contrast, said housing demand has shown marginal stabilization, with prices and sales likely to gradually steady in 2026 as inventories are worked down and valuation metrics approach longer-term norms.
Median forecasts show CPI inflation of about 0.5% in 2026 and PPI down 0.9%, both improvements on 2025 but still low. Official data show average CPI was flat year on year and PPI fell 2.7% in January–November 2025.
LU said supply-side policies aimed at curbing excessive competition could help prices recover, though strong supply relative to demand remains a drag. XIONG expects CPI and PPI to rise together, with PPI possibly turning positive in the second half of the year as policy measures lift commodity prices and global demand supports metals. XING cautioned that a low-price cycle could persist through 2026, with a more decisive turn not expected until 2027.
Economists expect the fiscal deficit ratio to stay at about 4% in 2026, with ultra-long bond issuance rising by roughly 200 billion yuan from this year's 1.3 trillion yuan, and new local government special bond quotas roughly steady or slightly higher than the 4.4 trillion yuan in 2025. Most forecast one to two rate cuts totaling 10 to 20 basis points, alongside a single reserve requirement cut of about 50 basis points.
ZHAO said fiscal policy would continue to support growth, structural adjustment and reform, while monetary policy would focus on maintaining liquidity and targeted support given pressure on bank margins. YANG expects mainly structural easing, with one rate cut and two RRR cuts, while XING said the central bank may rely more on quasi-fiscal tools to complement limited conventional easing.
LIAN said policy in 2026 is likely to emphasize industrial upgrading through technological self-reliance, expanded consumption support—including broader trade-in subsidies and services consumption—and steady infrastructure investment tied to major national projects, alongside continued efforts to stabilize the property market. Other economists highlighted potential upgrades to consumption policies, stronger support for new productive forces, expanded social spending, and deeper institutional opening in services and free-trade zones.
