Respuesta :
A free-floating exchange rate system is one in which governments or central banks do not meddle in the currency rate.
Explain a Free-Floating exchange rate system.
A currency's value is decided by the relative supply and demand of other currencies under a system of exchange rates known as a floating exchange rate. Currencies with floating exchange rates, as opposed to those with fixed exchange rates, provide limitless trading.
In a floating regime, the dynamics of foreign currency supply and demand normally control exchange rates. Floating exchange rates have been the preferred method for the US dollar, the euro of the euro zone, the Japanese yen, and the British pound sterling for many years.
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