a crawling peg exchange rate regime has a stated official exchange rate that on a day-to-day basis but that the government change when economic conditions warrant.

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12-12-2022
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a crawling peg exchange rate regime has a stated official exchange rate that on a day-to-day basis but that the government change when economic conditions warrant.

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KanakKhatana KanakKhatana · Answer 1 · 2022-12-19T06:51:24+01:00

A crawling peg exchange rate regime has a stated official exchange rate that on a day-to-day basis but that the government change when economic conditions warrant. This statement is true

What Is a Crawling Peg?

A system of exchange rate modifications known as a "crawling peg" permits a currency with a fixed exchange rate to vary within a range of rates. Additionally, regular adjustments may be made to the band of rates and the specified currency's par value, especially during periods of significant exchange rate volatility.

When a currency is weak, crawling pegs are employed to maintain exchange rate stability between trading partners. Crawling pegs are typically set by developing nations whose currencies are pegged to the euro or the dollar.

When there is a risk of devaluation because of elements like inflation or economic instability, crawling pegs are frequently utilized to regulate currency movements.

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