What is Managed Floating ? Explain it briefly.
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On: February 24, 2025
Daily Answer Writing Practice Questions (24 February 2025)
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The managed float exchange rate is one such system, in which the value of the currency is primarily decided by market forces but at times is interfered with by the government or the central bank in order to stabilize or reach certain economic objectives. Thus, this is a middle-of-the-road system combining both the characteristics of a free-floater as well as that of a fixed-exchanger, whereby there is the flexibility provided while, at the same time, the extreme fluctuations can be curbed.