UPDATE 2-China currency must rise faster-IMF chief

(Adds details, paragraphs 7-8; comments on Latin America from paragraph 9)

By Lesley Wroughton

WASHINGTON, May 7 (Reuters) - China's currency has strengthened against the dollar, but it needs to rise further and faster to help with the global adjustment of a weaker greenback, International Monetary Fund chief Dominique Strauss-Kahn said on Wednesday.

"With the renminbi managed and foreign reserves building, too much of the dollar's adjustment has fallen on free-floating currencies," Strauss-Kahn told the Council of the Americas, a business organization that focus on the Western Hemisphere, including Latin America.

The IMF Managing Director said sustaining growth in China would entail reducing the country's dependence on exports and investment growth and rebalancing demand toward domestic consumption.

That rebalancing would among other things require a further appreciation of the renminbi, also known as the yuan <CNYNDF=> <CNY=> <CNY=CFXS>.

"China needs to go further and faster if new misalignments among major currencies are to be avoided," Strauss-Kahn added.

The IMF, along with many Western countries, has prodded China to allow its currency to rise faster. Critics of China's currency policy argue that it gives the country an unfair trade advantage and contributes to huge imbalances, notably a hefty U.S. trade deficit.

Strauss-Kahn's comments came amid growing calls by economists and many businesses in China for the currency to rise more slowly. The People's Bank of China has allowed the renminbi to climb to keep down inflation.