IMF says move now on peg
21 October 2004
The International Monetary Fund (IMF) said China should loosen its US dollar currency peg now while the economy is growing a fast as it is. IMF Asia Pacific analyst Eswar Prasad told a Washington panel that it's especially important to get it right in good times or bank reforms could be reversed in the rapid growth of credit, which a more flexible exchange rate could mitigate. Despite bailouts and other restructuring efforts in recent years, non performing loans at China's banks have ballooned to more than US$500 billion.