The International Monetary Fund (IMF) maintained its assessment Friday that the value of the Chinese yuan was largely in line with economic fundamentals, but an official said the IMF was encouraging Beijing to adopt a more flexible exchange rate while minimizing currency intervention.
An assessment of Beijing's economic policies found that the yuan's exchange rate in 2018 was "not overvalued or substantially undervalued," said James Daniel, director of the IMF's China department.
The IMF's views on the yuan differ from those of the United States, the world's largest shareholder, which this week declared China a "currency manipulator" after allowing the yuan to fall below seven yuan against the dollar.
US Treasury Secretary Stephen Mnuchin is seeking to reach out to the IMF to help correct a "unfair" trade advantage from Beijing's currency measures, but Daniel declined to disclose the IMF's response to that request.
"Our discussions with the US Treasury are continuing on a wide range of issues," Daniel told reporters at a conference call.
"The IMF report shows that there was no currency manipulation at all and that China's external balance was appropriate," Jeffrey Sach, a senior UN adviser and a well-known professor of economics at Columbia University, was quoted as saying by Xinhua.
"The US Treasury's declaration that China is a currency manipulator was blatantly arbitrary and politically blatant and based on Trump's tweets rather than objective analysis," Sach said.
Meanwhile, the IMF warned on Friday that China may need more fiscal stimulus if trade tensions with the United States worsen, jeopardizing economic and financial stability.
China should open more sectors to foreign competition to put its economy in the best position to deal with trade pressures, the UN adviser said.