IMF urges more flexible yuan policy

"The authorities ... want to make sure that conditions are suitable before introducing greater flexibility," Rato, who met Premier Wen Jiabao and other ranking officials, said in a statement as he left China after a day of talks.

"I emphasized the advantages of making such a move from a position of strength, with circumstances in the period ahead likely to be favourable," he said.

"I welcomed the opportunity to discuss exchange rate issues and was pleased to hear the authorities reiterate their view that greater exchange rate flexibility is a desirable goal for China," Rato said.

"Indeed, the IMF has for some time believed that this would be in China's best interest as it would provide more room for the country to pursue an independent monetary policy and facilitate adjustment to structural changes."