Economists expect accelerated infrastructure investment and green projects to stabilize China’s economy after Q2 slowdown.
China’s July Politburo meeting is expected to prioritize executing existing fiscal plans rather than introducing new stimulus measures. Economists forecast a rebound in infrastructure spending during the second half of the year, following a sharp contraction in Q2 after front-loaded Q1 expenditures.
The slowdown in Q2 infrastructure investment appears intentional, aimed at fine-tuning spending pace after strong early-year growth. Spending will increasingly target AI-related, green transition, and high-tech projects to support near-term economic stabilization.
Monetary policy is expected to play a supplementary role, with fiscal measures remaining the primary tool for growth support. Markets are closely watching the Politburo’s approach to stimulus delivery.