China’s economy showed signs of stabilisation and gradual improvement in November, but authorities warned that external headwinds and persistent domestic imbalances continue to weigh on the outlook, signalling a readiness to step up policy support.

Speaking after the release of November activity data, a spokesperson for the National Bureau of Statistics (NBS) said economic conditions had “stabilised while improving,” reflecting firmer momentum in parts of industrial production and services. However, the official cautioned that changes in the external environment are having a deeper impact, underscoring ongoing pressure from global demand conditions, trade uncertainty and financial market volatility.

The spokesperson highlighted a growing tension between strong domestic supply capacity and weak demand, describing the imbalance as increasingly prominent. While production capacity in some sectors remains ample, subdued household and corporate demand continues to constrain pricing power and profitability. As a result, certain industries and firms are facing mounting operational difficulties.

The comments reinforce the view that China’s recovery remains uneven, with supply-side strength outpacing demand-side momentum. This imbalance has contributed to lingering deflationary pressures and has kept policymakers focused on supporting demand without reigniting financial risks.

In response, the NBS said authorities will step up both counter-cyclical and cross-cyclical policy adjustments, language that typically signals a willingness to deploy additional fiscal, monetary and structural support if conditions warrant. While no specific measures were outlined, the guidance suggests policymakers remain prepared to fine-tune stimulus to stabilise growth and cushion against external shocks.

The remarks are likely to reinforce market expectations for continued targeted support into early 2026, particularly if domestic demand fails to recover more decisively. For now, officials appear intent on maintaining stability while preserving flexibility to respond to a more challenging global backdrop.