TOKYO — China should let its “considerably undervalued” currency appreciate to help ease global trade imbalances, an IMF Asia director said Wednesday.
Shogo Ishii, director of the International Monetary Fund’s regional office for Asia and the Pacific, reiterated the IMF’s call for a stronger Chinese currency in its world economic outlook report earlier this month. “As for China, its real exchange rate level is considerably undervalued. It is a very large degree of undervaluation,” Ishii said at a briefing in Tokyo.
China “has to make its currency appreciate” and reduce its trade surplus to help rebalance global trade, he said.
Tensions between Washington and Beijing over the strength of the yuan have fueled fears of a global “currency war,” in which nations seek to devalue their currencies to help exporters.