VIEW: Goldman Expects Measured Fiscal Policy To Support 2024 Growth

China’s Politburo met on Friday December 8 ahead of the Central Economic Work Conference (CEWC) which Goldman Sachs expects will be held sometime this week. The accompanying statement continued to be supportive of growth but “the overall tone appears less dovish compared with the July”, but “policymakers pledged to step up fiscal policy support "at an appropriate pace"”.

• Goldman Sachs believes that “fiscal policy will do the heavy lifting of supporting growth next year. Today's readout mainly aims to provide the broad guidance of policy tone for next year. The CEWC may offer more discussion around fiscal, monetary, property and local government implicit debt resolution plans.”
• “Policymakers also vowed to enhance consistency in macro policies, and acknowledged the importance of managing expectations around economic growth.”
• “The authority softened the tone on significant reforms by stating that economic policies should be supportive first before being reformative ("先立后破"). This phrase was previously used in 2021 when policymakers tried to correct for the aggressive decarbonization efforts which contributed to coal shortages and power outages in many parts of the country.”