What is Floating exchange rate?
A '''floating exchange rate''' is when the [[exchange rate]] between two [[Currency|currencies]] can change freely. It is also known as '''flexible exchange rate''', or '''fluctuating exchange rate'''. [[Supply]] and [[demand]] will influence the exchange rate. Today, floating exchange rates between currencies are common. Usually, the [[market]] will regulate the exchange rate. In most cases, the [[Central bank|central banks]] of the affected countries will not intervene. They might do something, if the exchange rate rises above a certain threshold, or it falls below a minimal value. The opposite is a [[fixed exchange rate]], or pegged exchange rate. {{stub}} {{authority control}} [[Category:Currency]]