After a week of saying the dollar has fallen too far recently, International Monetary Fund (IMF) chief Rodrigo de Rato now says the dollar has more room to fall over the next several years, The Wall Street Journal reported Tuesday.

Over the "medium term," which is three to five years in IMF parlance, "we will see room for further depreciation," Rato said Monday.

The euro, he said, is "very near" its equilibrium value.

Last week, Rato first said the dollar had fallen too far in an interview with the Financial Times. He repeated that in Madrid and in a session with The Wall Street Journal, according to the report.

He said he was referring to the decline of the dollar compared with a "weighted" average of currencies over the past several years. The dollar gained slightly against the euro after his remarks.

Rato's remarks about the dollar being undervalued could look as if he were siding with European officials who worry that the strength of the euro, compared with the dollar, is undermining European exporters, the report said.

The report also said that U.S. Treasury officials consistently say they favor a strong dollar, but they do nothing to defend the currency as it falls in value.

In effect, the U.S. government depends on a steady decline of the dollar in order to narrow the nation's current account deficit, it said.

If the deficit remains too wide, many economists worry, it could ultimately lead to a crash in the dollar.