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Year-end leadership forum to flag hawkish policy shift

China’s leadership will gather in the coming days for the annual Central Economic Work Conference. With the economy now back on track, we think discussions will focus on the recent surge in debt levels and the withdrawal of COVID-19 stimulus measures. A more hawkish policy stance won’t derail China’s recovery overnight. But we do expect it to become a growing headwind by the second half of next year.

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