Huaqi Yu Xiangrong: It is expected that China will cut interest rates by 20 basis points and reserve requirements by 50 basis points in 2026.

Citi Group Chief Economist for Greater China, Yu Xiangrong, stated at the Citi China Summit media roundtable on November 13 that, with a 5.2% growth achieved in the first three quarters, China's target of 5% growth for the full year can be achieved. Next year marks the beginning of the "14th Five-Year Plan", and with the phase one trade agreement reached between China and the US, it is expected that the growth target for next year will remain around 5%. Yu Xiangrong predicts that there will be stronger macroeconomic policies compared to this year. In terms of monetary policy, it is expected that interest rates will be lowered by 20 basis points and reserve requirements will be reduced by 50 basis points in 2026. This is mainly to maintain an accommodative monetary environment and alleviate downward economic pressure. The relatively moderate adjustment is due to the constraints faced by the current monetary policy space. Yu Xiangrong stated that fiscal policy will continue to play a dominant role next year, with a certain level of expansion expected. It is projected that the general public budget deficit will be 4% of GDP, with an increased proportion of spending on people's livelihoods. Overall, it is estimated that the broad fiscal deficit for stabilizing the economy in 2026 will reach around 11.8 trillion yuan, equivalent to 7.9% of GDP, an increase of 1 trillion yuan or 0.4% of GDP compared to 2025.