As long as the leaf is not brown, I usually leave it on the plant. Once it turns brown, I cut it off as close to the pseudo stem as possible. A brown leaf is no longer providing energy to the plant.

It's not really completely brown, but it looks really ugly. The edges are curling and just looking pretty bad. On a good note, though, it has put out another leaf really quickly.

Go ahead and cut it off as the 'basjoo will replace any ratty leaves very quickly. Any reason you have not planted it in the ground?