IMF: Dollar “somewhat overvalued”, EUR closer to fundamental value

An IMF report to the G20 just hit the wires and says the dollar is still somewhat overvalued while the depreciation of the euro has moved it closer to its fundamental value. The JPY is broadly in-line with its fundamental value, the Fund says.

The world economy will grow 3.9% in 2010 and 4.3% on 2011, the IMF says, unchanged from earlier forecasts.

Countries like Greece are a key risk, the IMF says.

Monetary policy in advanced economies can remain accomodative.

EUR/USD is near afternoon highs, trading near the 1.3960 level. EUR/GBP has recovered to 0.9045.