Government Work Report: Innovate Structural Monetary Policy Tools, Appropriately Increase Scale, and Reduce Financing Intermediation Costs

2026-03-05 03:02:49

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[Caixin] What new trends in monetary policy are revealed in the 2026 Government Work Report? How will risks in real estate, local government debt, and small and medium financial institutions be further coordinated and resolved? On March 5th, Premier Li Qiang delivered the government work report, providing specific explanations on these issues.

Li Qiang mentioned that in 2026, the country will continue to implement a moderately loose monetary policy, prioritizing economic stability and reasonable price increases as key considerations. The government will flexibly and efficiently use various policy tools such as reserve requirement ratio cuts and interest rate reductions to maintain ample liquidity, ensuring that the growth of social financing and money supply aligns with economic growth and inflation expectations.

This is largely consistent with the stance of the Central Economic Work Conference at the end of 2025. The conference also emphasized smoothing the transmission mechanism of monetary policy and guiding financial institutions to strengthen support for expanding domestic demand, technological innovation, and key sectors such as small and micro enterprises.

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