The officials of the International Monetary Fund (IMF) have said that China should allow its currency to strengthen. This statement by IMF was delivered during its 10-day visit to China. The suggestions provided by the IMF to China were carefully worded, and the IMF believes that Beijing’s help is necessary in coping with severe debt problems in dozens of developing countries that have borrowed heavily from China and cannot afford the repayments.

Kristalina Georgieva, the managing director of the fund, said at a news conference that the renminbi could appreciate in real terms, which means adjusted for inflation. The value of each renminbi may need to rise 5 percent or more per year against other currencies in a context where producer prices are falling 2 percent a year in China and rising several percent a year elsewhere.

The global flooding of cheap Chinese goods, especially in the EU, has made their own industries vulnerable, prompting efforts to protect them.

Brad Setser and Mark Sobel wrote a research paper stating that the IMF’s formula for currency valuation suggested that the renminbi was undervalued by at least 18 percent. Mr. Setser, in an email to the NYT, mentioned that the Chinese central bank and state-controlled commercial banks are on track to buy another $250 billion worth of foreign assets in 2026 for the purpose of limiting the appreciation of the renminbi. This means that buying more foreign assets requires more selling of renminbi; the flow of more renminbi into the market decreases the value of the currency.