China Expected to Ease Monetary and Fiscal Policies to Support Economic Growth

China is likely to implement more supportive monetary and fiscal policies to stabilize its slowing economy, according to Huang Yiping, an adviser to the People’s Bank of China and professor at Peking University. Speaking at the Bund Summit in Shanghai, Huang noted that while high-frequency economic indicators such as exports remain strong, confidence and sentiment across the economy have weakened significantly.

China’s latest third-quarter GDP data revealed that growth in the world’s second-largest economy has slowed to its weakest pace in a year. The slowdown reflects persistent challenges including subdued consumer confidence, high debt levels, and external pressures from global trade tensions. In response, policymakers are expected to adopt a more pro-growth stance without resorting to large-scale stimulus.

Huang emphasized that fiscal and monetary measures would likely “become more supportive to growth,” but cautioned that a massive expansion of policy is unlikely. Instead, the government may pursue incremental easing through targeted fiscal spending and moderate monetary loosening to encourage investment and domestic demand.

He also suggested that Beijing could leverage its relatively low central government debt to strengthen its macroeconomic response. As of September, China’s central government leverage ratio stood at 28.8% of GDP—significantly lower than that of major developed economies such as the United States and Japan. Huang proposed that increasing central government borrowing could help repair the balance sheets of households, enterprises, financial institutions, and local governments.

Meanwhile, China’s Communist Party leadership recently reaffirmed its commitment to building a modern industrial system and achieving technological self-reliance, viewing these as essential for long-term stability and competitiveness amid rising global economic rivalry.