Deflationary pressures in China are manageable as the issue can be addressed by "decisive, forceful policy action", said Marshall Mills, senior resident representative of the International Monetary Fund in China. China releases its May CPI figures on Monday.

In an exclusive interview with ChinaPerspectives on the sidelines of the 2025 Tsinghua PBCSF Global Finance Forum, Mills said that China's pursuit of good macroeconomic policy is helping the global economy and that the fund encourages China to move quickly to further boost domestic demand with even more economic stimulus, especially on the fiscal front.

The desirable fiscal moves should be led by the central government and include reforming the fiscal system to strengthen the social safety net, as well as "forceful action" to correct property sector problems, Mills said, adding that authorities can continue down the road of monetary policy relaxation if the challenge of deflationary pressures persists.