Examining China’s new era of macro policies

Tighter regulation, looser liquidity and fiscal consolidation are likely the new features of China’s macro policies

Time to read: 3 min

China’s macro policies have entered a new phase following the National People’s Congress meeting held in March 2018. Compared to the past few years, we at Invesco Fixed Income think China’s macro policies will feature tighter regulation, looser liquidity and fiscal consolidation. As previously communicated by President Xi Jinping and his administration, China is:

  • Changing its focus from “quantity” to “quality” of economic growth
  • Seeking to reduce leverage, lower financing costs and strengthen the manufacturing sector
  • Seeking to reduce major economic risks, especially those related to the financial sector and local government indebtedness

2018 policy objectives

The central government’s 2018 macro objectives are