China | What do we expect for 2025 March “two sessions”?

Summary

The "two sessions" will discuss the most important issues ranging from the summary of last year economic achievements, to the announcement of 2025 key economic targets; from the continuation of the jumbo size stimulus package to outlining the blueprint of “Chinese-style modernization” with focus on high-end manufacturing.

Key points

• Key points:
• The 2025 “two sessions” have specially attracted global attention due to a confluence of domestic and international factors, including the trade war with the US under Trump 2.0 and rising China-US confrontations, China’s economic downturn with housing market crash, global economic deceleration and global central banks’ “pivot”, etc.
• .Growth target in 2025 is expected to be “around 5%” again, which signals the authorities’ strong determination to support growth amid Trump’s tariff war with China and China-US relationship uncertainties.
• Expansionary fiscal policy to stimulate growth and rebuild market sentiments. Fiscal deficit budget will be announced in “two sessions”, and the market expects it will surpass the 3% red line in 2025 to 4%.
• “Moderately loose” monetary policy stance to support domestic growth.
• How to support consumption growth will be the concentration of domestic growth stimulus. And Promoting “new quality productivity” is set to be a new growth engine to promote “Chinese style modernization".

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