IMF: CNY substantially undervalued

  • CNY substantially undervalued on real effective terms
  • BRL, ZAR looking increasingly overvalued
  • EUR, JPY broadly in-line with fundamentals
  • USD on the strong side of fundamentals; some depreciation would help global rebalancing
  • Recovery to continue in advanced economies but remain moderate
  • Tensions in euro zone periphery pose significant risk to recovery in region, possibly beyond
  • Potentially steep correction in Chinese property market an emerging risk to global recovery

Report prepared for the G20 meeting.

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