China’s Politburo says economic operation is generally stable

China’s Politburo convened on Monday, delivering a series of policy signals aimed at stabilizing growth and strengthening domestic demand ahead of 2025.

Key takeaways

• The Politburo noted that economic operation is generally stable.
• China will implement more active macro policies to reinforce momentum.
• Authorities will continue efforts to prevent and resolve risks in key areas, a reference to ongoing concerns in property, local government debt, and financial stability.
• Policymakers pledged to stabilise employment, markets, and business expectations.
• Fiscal policy will remain more active, with an emphasis on targeted support measures.
• Monetary policy will stay moderately loose, suggesting room for additional liquidity measures if needed.
• The leadership reiterated plans to build a strong domestic market, aligning with Beijing’s long-term shift toward consumption-driven growth.
• China will place greater importance on coordination between domestic economic policy and international economic and trade challenges next year.

Market reaction

AUD/USD held near session highs following the announcement, trading around 0.6645, up 0.08% on the day as traders viewed the policy tone as supportive for risk assets and commodity-linked currencies.