Maintaining fixed exchange rates became increasingly difficult, leading to the collapse of the system when the U.S. suspended the dollar’s convertibility into gold in 1971.

A drawback of fixed rates is that governments and central banks often have to work against market forces to maintain a currency peg (the policy a country uses to set a fixed exchange rate).

With an exchange rate near 89,000 LBP per 1 USD, the Lebanese pound remains the weakest in the world. Lebanon’s financial collapse, political dysfunction, and runaway inflation have destroyed ...

The principles focus on countries with flexible exchange rates. Most advanced economies have fully flexible exchange rates, known as free-floating. Some, like Canada, the United Kingdom, and the ...

This Economic Letter summarizes the papers presented at the conference “Asset Prices, Exchange Rates, and Monetary Policy” held at Stanford University on March 2-3, 2001, under the joint sponsorship ...