Overview
Exchange rate regimes play a crucial role in the global economy by determining how currencies are valued against one another. Understanding these regimes helps in grasping how international trade operates and how economic stability is maintained. Different regimes, such as fixed and floating rates, ...
Key Terms
Example: The Hong Kong dollar is pegged to the US dollar.
Example: The value of the US dollar fluctuates based on supply and demand.
Example: The Saudi riyal is pegged to the US dollar.
Example: High volatility can lead to uncertainty in international trade.
Example: The Federal Reserve adjusts interest rates to influence the economy.
Example: A high inflation rate can decrease currency value.