China Politburo prioritizes boosting domestic demand in 2026

China’s top leaders made strengthening domestic demand their top economic priority for 2026, as Beijing seeks a buffer against risks from global trade. “We must adhere to domestic demand as the main driver and build a strong domestic market,” the Communist Party’s decision-making Politburo led by President Xi Jinping pledged during its December huddle, according to the official Xinhua News Agency. Senior leaders vowed to keep their “more proactive” fiscal policy and maintain a “moderately loose” monetary stance, while aiming for a “good start” to the next five-year economic planning period that starts in 2026, according to the report. The meeting also pledged to adopt “cross-cyclical” policy adjustments, a phrase emphasizing longer-term planning that looks beyond volatility in economic growth. It’s the first time that language has appeared in a Politburo readout since December 2023. Preventing and resolving risks in key areas — usually a reference to dangers in local government debt, property and financial sectors — was lowered three places to the bottom of a list of eight major priorities for 2026. That indicates Beijing may put more focus on growth after investment slumped amid a campaign to rein in off-balance-sheeting borrowing by local authorities. Investment slump The commitment follows a loss of economic momentum in recent months amid a rapid pullback in investment. More challenges may lie ahead in the new year, with export growth at risk of slowing after a surprisingly strong 2025. Consumption will likely struggle to pick up from one of its weakest stretches in years, forcing the government to add support by expanding public spending. The December huddle typically sets the tone for the Central Economic Work Conference, which in turn provides details about policy priorities for the following year. More specific measures and numerical targets such as the economic growth goal and the size of the budget deficit won’t be revealed until China’s parliament opens its annual session in early March.

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China Politburo prioritizes boosting domestic demand in 2026