According to the China Merchants Macro Research Report, the Central Economic Work Conference was held in Beijing from December 10 to 11. Policy orientation: Next year's policy tone will change from “strengthening unconventional countercyclical adjustment” to “increasing countercyclical and cross-cyclical adjustment efforts” this year. We have two perspectives on this: on the one hand, the urgency of next year's policy is declining. Last year's conference clearly called for “all tasks to be carried out as early as possible and as soon as possible to ensure sufficient strength,” yet there were no similar statements at this year's conference. On the other hand, the adjustment of the policy tone does not mean that the strength of the policy will be clearly recovered in 2026. The conference added requirements for cross-cycle adjustments so that next year's policy orientation should be in line with this year's unconventional orientation and avoid a huge increase in policy adoption. In view of this, next year's cross-cycle adjustments are not a negative sign of policy orientation in the usual sense. What's more, the current fundamentals and price situation do not support major adjustments in macroeconomic policies next year. Therefore, we will continue to implement a more active fiscal policy and a moderately loose monetary policy next year. In terms of fiscal policy, the conference clearly proposed maintaining “maintaining the necessary fiscal deficit, total debt size, and total expenditure”. It is expected that indicators such as next year's budget deficit rate and the size of new government debt will remain at current levels. In terms of monetary policy, the conference called for monetary policy to take the two tasks of steady growth and promotion of inflation as the main goals, and once again mentioned the use of policy tools such as lowering interest rates and cutting interest rates. It is expected that next year, monetary policy will continue to adjust policy interest rates, structural policy instrument interest rates, and statutory reserve ratios.

According to the China Merchants Macro Research Report, the Central Economic Work Conference was held in Beijing from December 10 to 11. Policy orientation: Next year's policy tone will change from “strengthening unconventional countercyclical adjustment” to “increasing countercyclical and cross-cyclical adjustment efforts” this year. We have two perspectives on this: on the one hand, the urgency of next year's policy is declining. Last year's conference clearly called for “all tasks to be carried out as early as possible and as soon as possible to ensure sufficient strength,” yet there were no similar statements at this year's conference. On the other hand, the adjustment of the policy tone does not mean that the strength of the policy will be clearly recovered in 2026. The conference added requirements for cross-cycle adjustments so that next year's policy orientation should be in line with this year's unconventional orientation and avoid a huge increase in policy adoption. In view of this, next year's cross-cycle adjustments are not a negative sign of policy orientation in the usual sense. What's more, the current fundamentals and price situation do not support major adjustments in macroeconomic policies next year. Therefore, we will continue to implement a more active fiscal policy and a moderately loose monetary policy next year. In terms of fiscal policy, the conference clearly proposed maintaining “maintaining the necessary fiscal deficit, total debt size, and total expenditure”. It is expected that indicators such as next year's budget deficit rate and the size of new government debt will remain at current levels. In terms of monetary policy, the conference called for monetary policy to take the two tasks of steady growth and promotion of inflation as the main goals, and once again mentioned the use of policy tools such as lowering interest rates and cutting interest rates. It is expected that next year, monetary policy will continue to adjust policy interest rates, structural policy instrument interest rates, and statutory reserve ratios.