Floating exchange rate
Floating exchange rate is a rate that depends on the system currently in effect, where the forces of supply and demand are allowed to determine currency prices with little government intervention.
Definitions
According to Financial Management Theory and Practice by Eugene F. Brigham and Michael C. Ehrhardt (13th edition),
- Floating exchange rates. The system currently in effect, where the forces of supply and demand are allowed to determine currency prices with little government intervention.
According to Principles of Economics by Timothy Taylor (3rd edition),
- Floating exchange rate. When a country lets the value of its currency be determined in the exchange rate market.
According to Macroeconomics by Mankiw (7th edition),
- Floating exchange rate. An exchange rate that the central bank allows to change in response to changing economic conditions and economic policies. (Cf. fixed exchange rate.)
Related concepts
- Financial management. A combination of enterprise efforts undertaken in order to procure and utilize monetary resources of the enterprise.
