It is argued that a floating exchange rate regime gives countries monetary policy autonomy.

Question

Quizplus · Accepted Answer

Under a floating exchange rate regime, the exchange rate is determined by market forces, giving countries the flexibility to adjust their monetary policies according to their own economic conditions without having to worry about maintaining a fixed exchange rate. This allows for more autonomy in setting interest rates and adjusting money supply to achieve macroeconomic objectives such as controlling inflation and promoting economic growth.

It Is Argued That a Floating Exchange Rate Regime Gives