Freely Floating Exchange & Managed Floating Exchange Rate

Related BrainMass Solutions

• Floating currencies for Asian Countries

  A freely floating currency implies that the exchange rate is set by market forces and the government does not influence the exchange rate.

• Difference in fixed exchange rate and floating rate systems

  For the managed floating system, the overall exchange rate is determined by free movement of demand and supply but the monetary authorities intervene at certain times to "manage" the exchange rate to prevent high volatilities.

• Define a floating exchange rate.

  32892 Define a floating exchange rate. Please give some common descriptions of floating exchange rate and gives some relevant web references. Define a floating exchange rate? 1. A country's decision to allow its currency value to change freely.

• Economic exposure

  A freely floating rate increases the economic risk. If we look at the movement of exchange rate of Cedi with the US dollar we find that during the past one year the currency has been steadily weakening against the US Dollar.

• An Explanation of Exchange Rate

  Pros & Cons of Floating Exchange Rate: The floating exchange rate boasts various merits. Firstly, there is automatic correction in the floating exchange rate as the country simply lets it move freely to the equilibrium of demand and supply.

• Exchange rate

  41226 Exchange rate 1) Under a fixed exchange rate system, U.S. inflation would have a greater impact on inflation in other countries than it would under a freely floating exchange rate system. true.

• Exchange rate movements under system of managed floating

  178764 Exchange rate movements under system of managed floating Have exchange rate movements under the current system of managed floating been excessive? Explain.

• Programs of exchange rate management

  Floating Exchange Rate system within set limits or boundaries (dirty float). Here, the government sets the exchange rate with upper and lower limits.

• foreign exchange market

  A fixed exchange rate would have caused major problems at this time as some countries would be uncompetitive given their inflation rate. The floating rate allows a country to re-adjust more flexibly to external shocks.