IMF says yuan now only "moderately undervalued"

The International Monetary Fund now says China’s currency is only “moderately undervalued,” a change from its usual assessment of the yuan as either “significantly” or “substantially” undervalued, The Wall Street Journal reported. David Lipton, the IMF deputy managing director, said on Friday that the organization had changed its view because China’s current account surplus has declined and the value of the yuan appreciated. “We now assess the renminbi to be moderately undervalued against a broad basket of currencies,” he said. However, the IMF has not said how much it estimates the yuan is still undervalued. The new position could undercut efforts by the Obama administration to pressure China on the value of its currency. It will also bolster the case of Chinese officials, who have said in recent weeks that the currency is approaching an “equilibrium level.”