By Leika Kihara

WASHINGTON (Reuters) -China has scope to ramp up fiscal stimulus, but should shift the focus of spending away from industrial policy and toward steps to boost consumption, a senior International Monetary Fund official said on Thursday.

The Chinese economy remained resilient despite higher U.S. tariffs due to strong exports, though growth is likely to moderate to 4.2% next year from 4.8% in 2025, said Krishna Srinivasan, director of the IMF’s Asia and Pacific Department.

“Uncertainty remains high. Deflation pressures persist in China,” Srinivasan said in a press conference during the IMF and World Bank annual meetings in Washington.

“Near-term, China has fiscal space to provide more support to the economy,” though the key would be to rebalance its economy from a model re

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