An exchange rate is the rate at which one currency may be traded (bought or sold) for another currency. Normally it is more expensive to buy another currency than it is to sell that currency. This differential is referred to as the "spread" and the difference between the buy rate and the sell rate is referred to as the "mid rate". Unlike gold fixing exchange rate fixing or forex fixing does not have a universal method to globally stabilize the exchange rates. Without any central point of reference, it is up to every country to control their own exchange rates with other currencies in what is now a highly volatile but potentially lucrative market.Exchange rate fixing or the pegging of an individual country's exchange rate is generally done in an attempt to control that country's inflation. But this may have the undesired effect of slowing growth and even curbing the country's productivity.The IMF could permit countries to adjust their currency's price under fairly stringent guidelines. In 1971 it became obvious that the US$ could no longer remain pegged to gold so the major trading countries started to adopt a free market valuation of their currencies.It is interesting to note over the last ten years a hardening and a softening of exchange rate pegging. In 1990, developed countries did not use hard pegging at all. In 2001 over fifty percent of them were hard pegging their currencies.
Fetishism Malayalam Kamakeli Chitta KathakalAn exchange rate is the rate at which one currency may be traded (bought or sold) for another currency. Normally it is more expensive to buy another currency than it is to sell that currency. This differential is referred to as the "spread" and the difference between the buy rate and the sell rate is referred to as the "mid rate". Unlike gold fixing exchange rate fixing or forex fixing does not have a universal method to globally stabilize the exchange rates. Without any central point of reference, it is up to every country to control their own exchange rates with other currencies in what is now a highly volatile but potentially lucrative market.Exchange rate fixing or the pegging of an individual country's exchange rate is generally done in an attempt to control that country's inflation. But this may have the undesired effect of slowing growth and even curbing the country's productivity.The IMF could permit countries to adjust their currency's price under fairly stringent guidelines. In 1971 it became obvious that the US$ could no longer remain pegged to gold so the major trading countries started to adopt a free market valuation of their currencies.It is interesting to note over the last ten years a hardening and a softening of exchange rate pegging. In 1990, developed countries did not use hard pegging at all. In 2001 over fifty percent of them were hard pegging their currencies.
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