context: As Beijing enters 2026 with weak demand, tight local finances and heightened external uncertainty, macro management is shifting from adding tools to making them work together. After an unusually active 2025—marked by fiscal expansion and a return to a moderately loose monetary stance—the focus is now on avoiding policy offset and improving transmission. The call to strengthen 'policy integration effects' reflects concern that fragmented measures can dilute impact and undermine expectations.
Macro policy effectiveness in 2026 will hinge less on headline stimulus and more on coordination and precision, argues Zhong Caiping 钟才平 People’s Daily front-page commentator.
With fiscal and monetary policy both already operating in supportive territory, the central task is to integrate existing and new measures, strengthen cross-cycle adjustment and raise overall governance efficiency.
On the fiscal side, the emphasis shifts from scale to efficiency. After a year of higher deficits, larger bond issuance and increased transfers to stabilise growth, policy is now framed around maintaining 'necessary' deficit, debt and spending levels while preserving sustainability.
Priority is given to supporting 'two major' projects, optimising 'two new' policies, increasing basic research spending and strengthening employment support. At the same time, rising pressure on local finances is acknowledged, with calls to enhance local revenue capacity and improve expenditure discipline.
With general public budget spending reaching C¥29.7 tn in 2025 and central transfers at C¥10.3 tn, tighter management and better targeting are presented as essential. Fiscal resources are to be redirected toward national strategies, people-centred spending and consumption support, while enforcing 'tight belt' discipline across government.
Monetary policy is positioned as flexible and supportive rather than expansionary for its own sake.
Following multiple reserve-ratio and rate cuts in 2025, the 2026 stance prioritises maintaining ample liquidity, lowering overall financing costs and supporting price stabilisation—explicitly elevating 'reasonable price rebound' as a policy consideration.
A diversified toolkit, combining aggregate tools with structural facilities such as technology upgrading and service-consumption relending, is to be used to support domestic demand, innovation and small firms, while safeguarding financial system health. Exchange-rate policy continues to stress market determination, expectation guidance and basic stability of the RMB.
As policy tools proliferate, the risk of measures working at cross-purposes has risen. Zhong warns against 'synthetic fallacies' caused by inconsistent policy signals and argues for embedding all economic and non-economic measures—stock and incremental—into a unified consistency assessment framework. Macro policy success in 2026 depends on coherence as much as intensity.