Washington - The euro's recent decline on the foreign exchange markets is taking the European shared currency toward its real value, the International Monetary Fund said Monday.
"The recent real depreciation of the euro has moved it towards its fundamental value," the IMF said in a paper presented to a finance officials' meeting of the Group of 20 industrialized and developing countries in Seoul over the weekend.
The dollar is "still somewhat overvalued" but has moved "closer to its medium-run equilibrium," the Washington-based institution said.
The IMF noted that "some" emerging economies continued to resist the appreciation of their currencies.
"While this may be appropriate in some cases, it contributes to delaying the normalisation of monetary policy and complicates global rebalancing in others," the paper said.
For the Japanese currency, the IMF said its exchange rate was "broadly in line with medium-term fundamentals," following a substantial appreciation since late 2008.
China's yuan has depreciated "in tandem" with the US dollar and is "substantially undervalued from a medium-term perspective."
In early December, when the euro was trading above $1.51, the head of the eurozone's group of finance ministers, Jean-Claude Juncker of Luxembourg, said he and his peers agreed with the IMF that the euro was overvalued and some adjustments were needed.
The spiraling Greek debt crisis has weighed heavily on the euro amid fears Greece's woes could spread to other members of the 16-nation eurozone.