Core Viewpoint - The report anticipates that the investment boom driven by artificial intelligence, along with more supportive monetary and fiscal policies, will continue to propel strong global economic growth in 2026 [5] Global Economic Outlook - The global economy is expected to show resilience despite trade-related disruptions and policy uncertainties, with a stable and accelerating growth pattern anticipated for 2026 [6] - Fiscal constraints will be a significant theme in 2026, with concerns over inflation and financial repression if budget deficits are not controlled [6] Major Economies Macroeconomic Outlook United States - The U.S. economy is projected to maintain resilience, leading growth among developed markets with a real GDP growth of 2.4% [8] - Labor market conditions are expected to improve, with the unemployment rate dropping to 4.0% by year-end [8] - The Federal Reserve is anticipated to lower interest rates twice in June and September 2026 [8] Europe - The Eurozone is expected to enter a more constructive phase, with fiscal policy becoming a core issue and economic growth accelerating, particularly in the second half of 2026 [9] - The European Central Bank is likely to maintain deposit rates at 2.00% as inflation remains near target levels [9] China - China's GDP growth is forecasted to slow to 4.3%, with a drop to 4.1% in the first half of 2026, followed by a rebound to 4.5% in the second half due to policy stimulus [10] - The central economic work conference has continued a stance of "moderate easing" in monetary policy [10] Japan - Japan's economy is expected to continue its recovery, with core inflation projected to fall below 2% in the first quarter of 2026 [11] - The Bank of Japan may extend the pause on interest rate hikes for an additional year [11] Other Asian Countries - Strong AI demand and the supercycle of storage chips are expected to lead to differentiated economic growth across various countries in Asia [12] - Countries like South Korea, Singapore, Malaysia, and India may see GDP growth exceeding market expectations, while Thailand and the Philippines may underperform [12]

Revenue and Expenditure Trends - Public fiscal revenue growth for the first 11 months of 2025 was 0.8% year-on-year, maintaining the previous month's pace[3] - Public fiscal expenditure growth for the same period was 1.4%, a decrease of 0.6 percentage points from the previous month[3] - The deficit utilization rate for the first account was 62.2%, which is 9.2 percentage points lower than the average of the past three years[3] Tax Revenue Insights - National tax revenue growth for the first 11 months was 1.80%, an increase of 0.1 percentage points from the previous month[3] - Non-tax revenue saw a decline of 3.7%, down 0.6 percentage points from the previous month, influenced by a high base from last year[3] - Tax revenue growth has been positive for 8 consecutive months, reaching 2.8% in November, despite a slight decline from the previous month[3] Fiscal Spending Focus - Science and technology expenditure grew by 7.9% year-on-year, while social welfare spending increased by 5.4%, both outpacing overall fiscal expenditure growth[3] - Infrastructure spending remained weak, with a year-on-year decline of 7.7%, down 1.2 percentage points from the previous month[3] Government Fund Performance - Government fund revenue decreased by 4.9% year-on-year, while expenditure increased by 13.7%, showing a marginal decline from the previous month[3] - In November, government fund revenue fell by 15.8%, but expenditure grew by 2.8%, indicating stronger expenditure performance[3] Overall Fiscal Outlook - The cumulative year-on-year growth rate of broad fiscal revenue fell by 0.5 percentage points, while expenditure growth decreased by 0.7 percentage points, suggesting less urgency for short-term fiscal stimulus[3] - The central economic work conference emphasized accelerating fund disbursement to promote actual spending and physical work volume[3] Risk Factors - Potential risks include underperformance of growth stabilization policies, escalation of geopolitical conflicts, and greater-than-expected overseas economic downturns[11]

Core Viewpoint - The Ministry of Finance has revised the management measures for the reward funds for major pig (and sheep) producing counties to enhance the capacity for pig and sheep supply, aligning with national policies aimed at stabilizing meat production and ensuring market supply [1][2]. Group 1: Policy Changes - The revised measures allocate reward funds based on a factor method, considering the average annual pig output, slaughter volume, and stock over the past three years, with respective weights of 50%, 25%, and 25% [1]. - The distribution of reward funds will now support the top 500 pig-producing counties nationwide, while the range for sheep-producing counties has been adjusted to the top 100 [1]. Group 2: Financial Implications - The revised measures clarify that reward funds will serve as general transfer payments to support local financial resources, allowing local governments to allocate these funds as needed [2]. - The distribution of provincial reward funds will consider the production situation of pigs and sheep in each province, based on the average annual output over the past three years [2]. Group 3: Market Impact - The stability of agricultural product supply is emphasized as a key area for fiscal support, with the revised measures expected to motivate local governments to enhance production and supply stability [2]. - The Ministry of Finance has allocated a total of 3.33 billion yuan for the 2026 pig (and sheep) producing county reward funds, with the top three provinces receiving significant amounts: Hunan (368 million yuan), Henan (347 million yuan), and Sichuan (313 million yuan) [3].

2025年，我国经济顶压前行、向新向优发展。党的二十届四中全会和中央经济工作会议召开，为推动高 质量发展注入强大动力。在此背景下，如何看待当前中国经济形势，2026年我国经济又将有哪些核心增 长点？《证券日报》采访了八大首席经济学家进行深入解读。 2025年经济韧性凸显 中信建投首席经济学家黄文涛表示，2026年赤字率保持不低于4%，广义口径或抬升至8.8%左右，支出 端进一步强化"投资于人"的领域。 分析原因，温彬表示，考虑到2026年是"十五五"规划开局之年，对于稳定预期和提振信心至关重要，而 在复杂的内外部形势之下，我国发展面临的不确定因素增多，有必要发挥积极财政政策作用，加大逆周 期和跨周期调节力度，并注重提升政策效能，推动经济实现质的有效提升和量的合理增长。 12月份以来，多家国际机构上调中国经济增速预期，如IMF（国际货币基金组织）预计2025年中国经济 增速为5%，较10月份预测上调0.2个百分点。世界银行预测为4.9%，较6月份预测上调0.4个百分点。 民生银行首席经济学家温彬告诉《证券日报》记者，今年以来，尽管面临多重冲击，中国经济仍展现出 充足韧性。更加积极的财政政策和适度宽松的货币政策支 ...

Revenue and Expenditure Trends - In November 2025, the national general public budget revenue showed a year-on-year growth of -0.02%, down from 3.2% previously, indicating a significant slowdown in revenue growth due to economic fundamentals[1] - The national general public budget expenditure in November 2025 decreased by 3.7% year-on-year, an improvement from the previous decline of 9.8%[1] - The broad fiscal budget revenue completion rate for January to November 2025 was 85.3%, with a monthly year-on-year decline of 5.2% in November, higher than the same period in 2024[2] Tax Revenue Insights - Tax revenue in November 2025 was 11,450 billion yuan, with a year-on-year growth of 2.8%, while non-tax revenue was 2,576 billion yuan, showing a decline of 10.8%[3] - The corporate income tax turned negative, reflecting a broader economic slowdown, while personal income tax maintained a high growth rate, partly due to enhanced tax collection efforts[4] Government Fund Budget Analysis - The government fund budget revenue in November 2025 decreased by 15.8% year-on-year, an improvement from the previous decline of 18.4%, primarily due to reduced land transfer income[7] - Government fund budget expenditure in November 2025 increased by 2.8% year-on-year, recovering from a previous decline of 38.2%, attributed to accelerated project funding[8] Future Fiscal Outlook - For 2026, there is a potential for a slight increase in the deficit ratio, estimated between 4.0% and 4.2%, corresponding to a deficit scale of approximately 5.89 trillion to 6.19 trillion yuan[3] - The broad fiscal deficit scale is projected to be around 11.79 trillion to 12.09 trillion yuan, with local special bonds estimated at about 4.4 trillion yuan[3]

1. Report Industry Investment Rating No information provided in the content. 2. Core Viewpoints of the Report - Fiscal policy is expected to remain proactive next year, with a moderately increased intensity. The deficit-to-GDP ratio is expected to be 4% in 2026, and the net supply of government bonds is projected to reach 15.2 trillion yuan, an increase of about 820 billion yuan compared to 2025. The front-loading degree of fiscal policy implementation may moderate compared to this year [2][11][42]. - For the bond market, the fiscal policy is likely to provide a measured boost rather than strong stimulus, so a significant market adjustment driven by fiscal expansion is unlikely. However, attention should be paid to potential volatility caused by market speculation about further policy escalation. The pressure from government bond supply is likely to be manageable, and the impact may mainly manifest in the term structure, maintaining a steepening yield curve [3][4]. 3. Summary According to the Table of Contents Proactive Fiscal Policy Stone - The central government's stance on macro policy is relatively proactive. The "Recommendations for the 15th Five - Year Plan" emphasizes strengthening counter - and cross - cyclical adjustments and implementing more proactive macro policies, as well as leveraging the role of proactive fiscal policy to improve fiscal sustainability [12][43]. Moderate Expansion of Fiscal Policy 2.1 The Economy is generally better than the same period last year - Domestic demand continues its moderate recovery. The GDP growth rate for the first three quarters of this year was better than the same period last year (5.2% vs. 4.8%), and the inflation readings are overall better than last year. Consumer confidence has been warming up from low levels. The necessity for a significant marginal increase in fiscal policy intensity in 2026 is likely not high [13][43]. - Tariff risks have marginally diminished. The US side will cancel the 10 - percent "fentanyl tariffs" and suspend the 24 - percent reciprocal tariffs on Chinese goods for an additional year. The trade situation may have eased compared to the same period last year [14][44]. 2.2 Estimated Treasury Bond Net Financing: 7.08 tn Yuan, + 420 bn Yuan - The targeted deficit - to - GDP ratio is expected to be 4%, corresponding to a deficit scale of approximately 5.88 trillion yuan. The main entity for increasing leverage is likely to be the central government, with a targeted deficit of 5.08 trillion yuan, while local governments' target deficit is expected to remain flat at 80 billion yuan [14][47]. - The issuance of ultra - long - term special treasury bonds is expected to total 1.6 trillion yuan, and the scale of special treasury bonds for capital injection into central financial institutions is projected to be 40 billion yuan. The total issuance scale of special treasury bonds in 2026 is estimated to reach 2 trillion yuan. The net financing of treasury bonds in 2026 is projected to be 7.08 trillion yuan, an increase of 42 billion yuan YoY [15][47][48]. 2.3 Estimated Local Government Bond Net Financing: at 8.1 tn Yuan, + 400 bn Yuan - The scale of local government bonds is projected to reach 5.6 trillion yuan in 2026. The targeted local government deficit is expected to remain unchanged at 80 billion yuan, and the scale of special - purpose bonds is anticipated to increase to 4.8 trillion yuan. An additional 50 billion yuan from the unused bond quota may be allocated next year. The net financing of local government bonds is projected to reach approximately 8.1 trillion yuan, an increase of 40 billion yuan compared to the current year [29][64]. - Overall, the net financing scale of government bonds is projected to reach 15.2 trillion yuan in 2026, an increase of approximately 82 billion yuan compared to the current year [30][64]. Optimized Expenditure Structure: Investing in People - During the "15th Five - Year Plan" period, fiscal policy will continue to focus on people's livelihood, optimizing the expenditure structure and increasing the proportion of spending on livelihood - related projects [38][71]. Less Front - loaded Implementation of Fiscal Policy - Fiscal policy support in 2026 is expected to remain front - loaded, but the degree of front - loading may be reduced. The utilization of 50 billion yuan in new policy - oriented financial tools and idle fiscal deposits may bolster the economic fundamentals at the end of this year and early next year. The U.S. mid - term elections in the second half of 2026 could reignite tariff risks, necessitating reserved policy space for response measures [39][72].

Macro Analysis - The central economic work conference highlighted ongoing challenges in the economy, including external environmental changes and risks in key sectors, while emphasizing the need to balance domestic economic work and international trade struggles [2][3] - The conference introduced five "musts" for economic work, focusing on the integration of investment in physical and human capital and the importance of internal strengthening to address external challenges [2] Policy Orientation - The policy tone for the upcoming year shifts from "strengthening extraordinary counter-cyclical adjustments" to "increasing counter-cyclical and cross-cyclical adjustment efforts," indicating a decrease in urgency but maintaining a proactive fiscal and moderately loose monetary policy [3] - Fiscal policy will maintain necessary levels of deficit, debt, and total expenditure, while monetary policy will focus on stabilizing growth and promoting inflation, with expectations for adjustments in interest rates and reserve requirements [3] Key Economic Work Areas - The economic work for the next year will focus on eight key areas, with an emphasis on expanding domestic demand through urban renewal policies and increasing investment scale to counteract negative growth in investment [7] - The conference reiterated the importance of stabilizing the real estate market through targeted measures, including inventory reduction and supply optimization, indicating a potentially more proactive stance on real estate policies [8][18] Real Estate Market Insights - The conference emphasized "high-quality urban renewal" as a crucial strategy for expanding investment and stimulating domestic demand, with expectations for financial tools to support urban renewal projects [17] - The focus on stabilizing the real estate market has shifted from aggressive measures to a more balanced approach, with an emphasis on controlling supply and inventory while encouraging the acquisition of existing properties for affordable housing [18][20] ESG Developments - The report highlighted significant ESG policies, including the expansion of the national carbon trading market and the promotion of integrated development in the renewable energy sector, which are crucial for achieving carbon neutrality goals [21][22] - The issuance of green financial bonds and the successful launch of digital green bonds in Hong Kong reflect growing market recognition and support for sustainable finance initiatives [24][25]

Revenue Insights - In November, the growth rate of general public budget revenue fell to 0% from 3.2% in October, with tax revenue growth declining by 5.4 percentage points to 3.2%[3] - The cumulative year-to-date growth rates for VAT and corporate income tax are 3.9% and 1.7%, respectively, outperforming last year's rates of -3.8% and -0.5%[3] - Non-tax revenue continued its negative growth trend, with a year-on-year decline narrowing from 32.8% in October to 10.8% in November[3] Expenditure Insights - The year-on-year decline in general fiscal expenditure narrowed from 19.1% in October to 1.7% in November, while the adjusted expenditure growth rate increased from 15% to 33% month-on-month[2] - General public budget expenditure's year-on-year decline improved from -9.3% in October to -4.2% in November, with 83.7% of the annual budget utilized by the end of November, lower than the five-year average of 85.4%[7] - Government fund expenditure turned positive at 2.8% in November, recovering from a -38.2% decline in October, primarily due to increased local government bond issuance[9] Market Implications - The marginal recovery in fiscal expenditure suggests resilience in fiscal policy, which is crucial for stabilizing growth and market expectations[4] - The ongoing fiscal policy adjustments are expected to support domestic demand and investment, particularly through special bonds and budgetary investments[5] - The overall economic outlook remains cautious, with potential risks from insufficient fiscal stimulus and weaker domestic demand[9]

Revenue and Expenditure Overview - National general public budget revenue for January-November 2025 reached 200,516 billion yuan, a year-on-year increase of 0.8%[2] - National general public budget expenditure totaled 248,538 billion yuan, with a year-on-year growth of 1.4%[2] - Government fund budget revenue was 40,274 billion yuan, showing a year-on-year decline of 4.9%[2] - Government fund budget expenditure increased to 92,124 billion yuan, reflecting a year-on-year growth of 13.7%[2] Public Finance Insights - The growth rate of public finance expenditure decreased by 0.6 percentage points compared to January-October 2025, necessitating a December growth rate of over 20% to meet annual targets[3] - Expenditure focus areas included livelihood, technology, and green initiatives, with technology spending growth reaching 7.9%[3] - Social security and employment spending grew by 8.1%, indicating strong support for livelihoods[3] - Infrastructure spending saw a decline of 7.7%, with only environmental spending showing positive growth[3] Government Fund Challenges - The year-on-year decline in government fund revenue was exacerbated by a 2.1 percentage point increase in the decline rate, primarily due to land market issues[4] - Government fund expenditure growth slowed to 13.7%, influenced by high base effects from 2024's special bond issuance[4] Fiscal Policy Outlook - The central economic work conference emphasized maintaining necessary fiscal deficits and total expenditure, indicating a proactive fiscal approach for 2026[8] - Key focus areas for future spending include optimizing expenditure structure and addressing local government financial pressures[8]

Core Viewpoint - The central economic work conference indicates a moderate approach to economic stabilization rather than strong stimulus, focusing on maintaining growth levels and alleviating deflationary pressures without significant policy shifts [3]. Fiscal Policy - The fiscal deficit, including both explicit and implicit components, is set to remain at levels similar to 2025, with an emphasis on front-loading expenditures, particularly in infrastructure such as urban renewal and green transformation projects [4]. - There is potential for an additional fiscal space equivalent to 0.5% of GDP if conditions in real estate, prices, and employment improve in the first half of the year [5]. Monetary Policy - The actual space for interest rate cuts and reserve requirement ratio reductions is limited, with a focus on structural tools and quasi-fiscal measures, suggesting a possible reduction of 10-20 basis points throughout the year [5]. Real Estate Policy - Support measures for real estate, such as subsidizing mortgage rates, may not materialize until after the national two sessions, with details expected in the second quarter of 2026 [5]. - A broad and sustained subsidy for mortgage rates could stabilize market expectations and break the negative feedback loop of falling housing prices and credit contraction [6][9]. Consumption Policy - The continuation of the national subsidy for replacing old with new products is expected, with adjustments in scale and coverage, but there is uncertainty about significant support for service sector consumption [6]. - Direct subsidies for consumer spending, particularly in the service sector, may take longer to implement, potentially not appearing until the second half of the year [6]. Export Outlook - Despite concerns about export reliance, China's share of global exports is projected to increase from 15% to 16-17% over the next five years, with growth rates expected to outpace global trade growth [7]. - The shift towards "de-China-ization" is seen as a trade chain extension rather than a reduction in China's market share, with Chinese enterprises maintaining a competitive edge in high-value sectors [7][8]. Talent and Innovation - China produces approximately 11 million university graduates annually, with a significant portion in engineering and technology fields, contributing to its competitive advantage in key sectors [8]. - The global supply chain is evolving towards multi-polarity but remains reliant on Chinese enterprises, indicating a robust position for China in the global market [8]. Economic Transition - There is a call for a shift towards consumption-driven growth in 2026, emphasizing social security improvements and support for farmers and migrant workers to enhance consumer capacity [8]. - A broader focus on supporting service sector consumption through subsidies and vouchers is recommended to stimulate economic activity [8].