I have extracted excerpts from this document that deal with the currency issue.
Group of Twenty
Meeting of G-20 Ministers and Deputies
September 3-4, 2009
London, United Kingdom
Global Economic Prospects and
Policy Challenges
Prepared by Staff of the International Monetary Fund
Exchange rates are gradually returning to pre-crisis levels in both nominal and real effective terms. The U.S. dollar has depreciated in real effective terms in recent months as safe haven flows have been gradually unwound, but both the dollar and the euro remain somewhat more appreciated than their pre-Lehman levels. By contrast, the Japanese yen—which has appreciated significantly in real effective terms—and the U.K. pound—which has depreciated substantially—remain far from their pre-Lehman levels.
Reflecting the improvement in commodity prices and reduced risk aversion, many emerging economy currencies have appreciated both against the U.S. dollar and in real effective terms since September 2008. The Chinese renminbi—which has been broadly stable vis-à-vis the U.S. dollar since June 2008—appreciated modestly in real effective terms over this period and remains substantially undervalued relative to medium-term fundamentals. In some other major emerging economies—such as Brazil, Indonesia, and South Africa—recent currency appreciation has almost offset earlier depreciation.
Group of Twenty
Meeting of G-20 Ministers and Deputies
September 3-4, 2009
London, United Kingdom
Global Economic Prospects and
Policy Challenges
Prepared by Staff of the International Monetary Fund
Exchange rates are gradually returning to pre-crisis levels in both nominal and real effective terms. The U.S. dollar has depreciated in real effective terms in recent months as safe haven flows have been gradually unwound, but both the dollar and the euro remain somewhat more appreciated than their pre-Lehman levels. By contrast, the Japanese yen—which has appreciated significantly in real effective terms—and the U.K. pound—which has depreciated substantially—remain far from their pre-Lehman levels.
Reflecting the improvement in commodity prices and reduced risk aversion, many emerging economy currencies have appreciated both against the U.S. dollar and in real effective terms since September 2008. The Chinese renminbi—which has been broadly stable vis-à-vis the U.S. dollar since June 2008—appreciated modestly in real effective terms over this period and remains substantially undervalued relative to medium-term fundamentals. In some other major emerging economies—such as Brazil, Indonesia, and South Africa—recent currency appreciation has almost offset earlier depreciation.