In a pure floating exchange-rate system governments engage in foreign exchange market intervention to influence the value of their currency.

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In a pure floating exchange-rate system, governments do not intervene in the foreign exchange market to influence the value of their currency. Instead, the exchange rate is determined by market forces of supply and demand. Governments may still intervene in the foreign exchange market in order to address extreme volatility or disorderly market conditions, but this is not done with the intention of targeting a specific exchange rate.

In a Pure Floating Exchange-Rate System Governments Engage in Foreign