Economists see China growth slowing to about 4.5% in 2026

A poll of 73 economists published Jan. 15 projected China’s GDP growth would slow to about 4.5% in 2026, down from an estimated 4.9% in 2025, and remain near 4.5% in 2027. The forecast, if borne out, tightens the policy challenge for Beijing: sustaining employment and activity without reigniting financial risks tied to debt and excess capacity.

The economists expected the fourth quarter of 2025 to have expanded 4.4% year-on-year, the weakest annual pace in three years and a step down from 4.8% in the third quarter. On a quarter-on-quarter basis Q4 was projected to have grown 1.0%, slightly below the 1.1% pace in July–September. Those quarterly softening signals underscore a transition from the export-led bounce of 2025 toward more fragile domestic demand.

Inflation remained muted last year, the poll showed, and was forecast to pick up modestly: consumer prices were expected to rise about 0.7% in 2026 and to reach roughly 1.0% by 2027. The low-inflation backdrop has helped keep real borrowing costs elevated for heavily indebted local governments and cash-strapped property developers, constraining credit-fueled recovery in construction and investment.

Monetary policy was seen tilting looser to support liquidity. Respondents anticipated the People’s Bank of China would cut the reserve requirement ratio and reduce policy rates in 2026 to keep conditions "appropriately loose." Near-term expectations centered on a modest step: a 10 basis-point cut to the seven-day reverse repo rate in the first quarter of 2026 to ease short-term funding strains.

The poll identified weak domestic demand, a prolonged property slump and lingering deflationary forces as the main drags on growth. At the same time, external demand was the surprise positive in 2025: record export gains helped offset domestic weakness. A separate poll of economists taken around Jan. 12 projected December 2025 exports rose 3.0% year-on-year in value terms, down from a 5.9% gain in November, reflecting a pivot by exporters toward Southeast Asia, Africa and Latin America as firms sought to diversify away from U.S. tariff pressures.

Policymakers have already deployed targeted measures, including accelerated infrastructure spending, consumer subsidies and episodic injections of liquidity, and analysts say further calibrations are likely if export momentum falters. But full-scale stimulus is widely judged unlikely because of concerns about mounting local government debt and the risk of exacerbating overcapacity. President Xi Jinping has signaled a greater tolerance for slower expansion, and Beijing has publicly maintained a growth aim described as "around 5%," even as several foreign banks increasingly expect a de facto target in the 4.5–5% range.

Markets and investors will watch two thresholds closely: whether exports maintain their resilience and whether Beijing is willing to scale targeted fiscal measures without broad credit loosening. If exports disappoint, analysts say additional domestic support would likely follow; the size and composition of that support will determine whether China can sustain a soft landing or slide into a longer period of subdued growth.