Fixed exchange-rate system

A fixed exchange rate, sometimes called a pegged ex-change rate, is a type of exchange rate regime where acurrency's value is fixed against either the value of an-other single currency, to a basket of other currencies, orto another measure of value, such as gold. There are ben-efits and risks to using a fixed exchange rate. A fixed ex-change rate is usually used in order to stabilize the valueof a currency by directly fixing its value in a predeter-mined ratio to a different, more stable or more interna-tionally prevalent currency (or currencies), to which thevalue is pegged. In doing so, the exchange rate betweenthe currency and its peg does not change based on mar-ket conditions, the way floating currencies will do. Thismakes trade and investments between the two currencyareas easier and more predictable, and is especially use-ful for small economies in which external trade forms alarge part of their GDP.A fixed exchange-rate system can also be used as a meansto control the behavior of a currency, such as by limitingrates of inflation. However, in doing so, the pegged cur-rency is then controlled by its reference value. As such,when the reference value rises or falls, it then followsthat the value(s) of any currencies pegged to it will alsorise and fall in relation to other currencies and commodi-ties with which the pegged currency can be traded. Inother words, a pegged currency is dependent on its refer-ence value to dictate how its current worth is defined atany given time. In addition, according to the Mundell–Fleming model, with perfect capital mobility, a fixed ex-change rate prevents a government from using domesticmonetary policy in order to achieve macroeconomic sta-bility.In a fixed exchange-rate system, a country’s central banktypically uses an open market mechanism and is commit-ted at all times to buy and/or sell its currency at a fixedprice in order to maintain its pegged ratio and, hence, thestable value of its currency in relation to the referenceto which it is pegged. The central bank provides the as-sets and/or the foreign currency or currencies which areneeded in order to finance any payments imbalances.[1]

In the 21st century, the currencies associated with largeeconomies typically do not fix or peg exchange rates toother currencies. The last large economy to use a fixedexchange rate system was the People’s Republic of Chinawhich, in July 2005, adopted a slightly more flexible ex-change rate system called a managed exchange rate.[2]The European Exchange Rate Mechanism is also usedon a temporary basis to establish a final conversion rateagainst the Euro (€) from the local currencies of coun-

tries joining the Eurozone.

1 History

Main article: International monetary systems

The gold standard or gold exchange standard of fixedexchange rates prevailed from about 1870 to 1914, be-fore which many countries followed bimetallism.[3] Theperiod between the two world wars was transitory, withthe Bretton Woods system emerging as the new fixed ex-change rate regime in the aftermath of World War II. Itwas formed with an intent to rebuild war-ravaged nationsafter World War II through a series of currency stabiliza-tion programs and infrastructure loans.[4] The early 1970ssaw the breakdown of the system and its replacement bya mixture of fluctuating and fixed exchange rates.[5]

1.1 Chronology

Timeline of the fixed exchange rate system:[6]

1.2 Gold standard

The earliest establishment of a gold standard was in theUnited Kingdom in 1821 followed by Australia in 1852and Canada in 1853. Under this system, the exter-nal value of all currencies was denominated in terms ofgold with central banks ready to buy and sell unlimitedquantities of gold at the fixed price. Each central bankmaintained gold reserves as their official reserve asset.[7]For example, during the “classical” gold standard period(1879–1914), the U.S. dollar was defined as 0.048 troyoz. of pure gold.[8]

1.3 Bretton Woods system

Following the SecondWorldWar, the BrettonWoods sys-tem (1944–1973) replaced gold with the U.S. dollar asthe official reserve asset. The regime intended to com-bine binding legal obligations with multilateral decision-making through the International Monetary Fund (IMF).The rules of this system were set forth in the articles ofagreement of the IMF and the International Bank for Re-construction and Development. The system was a mon-etary order intended to govern currency relations among

1

2 3 OPEN MARKET MECHANISM EXAMPLE

sovereign states, with the 44 member countries requiredto establish a parity of their national currencies in termsof the U.S. dollar and to maintain exchange rates within1% of parity (a "band") by intervening in their foreign ex-change markets (that is, buying or selling foreign money).The U.S. dollar was the only currency strong enough tomeet the rising demands for international currency trans-actions, and so the United States agreed both to link thedollar to gold at the rate of $35 per ounce of gold and toconvert dollars into gold at that price.[6]

Due to concerns about America’s rapidly deterioratingpayments situation and massive flight of liquid capitalfrom the U.S., President Richard Nixon suspended theconvertibility of the dollar into gold on 15 August 1971.In December 1971, the Smithsonian Agreement pavedthe way for the increase in the value of the dollar priceof gold from US$35.50 to US$38 an ounce. Speculationagainst the dollar in March 1973 led to the birth of the in-dependent float, thus effectively terminating the BrettonWoods system.[6]

1.4 Current monetary regimes

Since March 1973, the floating exchange rate has beenfollowed and formally recognized by the Jamaica accordof 1978. Countries still need international reserves in or-der to intervene in foreign exchange markets to balanceshort-run fluctuations in exchange rates.[6] The prevail-ing exchange rate regime is in fact often considered asa revival of the Bretton Woods policies, namely BrettonWoods II.[9]

2 Mechanisms

2.1 Open market trading

Typically, a government wanting to maintain a fixed ex-change rate does so by either buying or selling its owncurrency on the open market. This is one reason govern-ments maintain reserves of foreign currencies. If the ex-change rate drifts too far below the fixed benchmark rate,the government buys its own currency in the market usingits reserves. This places greater demand on the marketand pushes up the price of the currency. If the exchangerate drifts too far above the desired rate, the governmentsells its own currency, and buys foreign currency, thus re-ducing the pressure on demand, and its foreign reservesfall.

2.2 Fiat

Another, less used means of maintaining a fixed exchangerate is by simply making it illegal to trade currency at anyother rate. This is difficult to enforce and often leads toa black market in foreign currency. Nonetheless, some

countries are highly successful at using this method due togovernment monopolies over all money conversion. Thiswas the method employed by the Chinese government tomaintain a currency peg or tightly banded float against theUS dollar. Throughout the 1990s, China was highly suc-cessful at maintaining a currency peg using a governmentmonopoly over all currency conversion between the yuanand other currencies.[10][11]

3 Open market mechanism exam-ple

Fig.1: Mechanism of fixed exchange-rate system

Under this system, the central bank first announces a fixedexchange-rate for the currency and then agrees to buy andsell the domestic currency at this value. The market equi-librium exchange rate is the rate at which supply and de-mand will be equal, i.e., markets will clear. In a flexi-ble exchange rate system, this is the spot rate. In a fixedexchange-rate system, the pre-announced rate may notcoincide with the market equilibrium exchange rate. Theforeign central banks maintain reserves of foreign curren-cies and gold which they can sell in order to intervene inthe foreign exchange market to make up the excess de-mand or take up the excess supply [1]

The demand for foreign exchange is derived from the do-mestic demand for foreign goods, services, and financialassets. The supply of foreign exchange is similarly de-rived from the foreign demand for goods, services, andfinancial assets coming from the home country. Fixedexchange-rates are not permitted to fluctuate freely or re-spond to daily changes in demand and supply. The gov-ernment fixes the exchange value of the currency. Forexample, the European Central Bank (ECB) may fix itsexchange rate at €1 = $1 (assuming that the euro followsthe fixed exchange-rate). This is the central value or parvalue of the euro. Upper and lower limits for the move-ment of the currency are imposed, beyond which varia-tions in the exchange rate are not permitted. The “band”or “spread” in Fig.1 is €0.4 (from €1.2 to €0.8).[12]

3

3.1 Excess demand for dollars

Fig.2: Excess demand for dollars

Fig.2 describes the excess demand for dollars. This is asituation where domestic demand for foreign goods, ser-vices, and financial assets exceeds the foreign demand forgoods, services, and financial assets from the EuropeanUnion. If the demand for dollar rises from DD to D'D',excess demand is created to the extent of cd. The ECBwill sell cd dollars in exchange for euros to maintain thelimit within the band. Under a floating exchange rate sys-tem, equilibrium would have been achieved at e.When the ECB sells dollars in this manner, its official dol-lar reserves decline and domestic money supply shrinks.To prevent this, the ECB may purchase governmentbonds and thus meet the shortfall in money supply. Thisis called sterilized intervention in the foreign exchangemarket. When the ECB starts running out of reserves,it may also devalue the euro in order to reduce the ex-cess demand for dollars, i.e., narrow the gap between theequilibrium and fixed rates.

3.2 Excess supply of dollars

Fig.3: Excess supply of dollars

Fig.3 describes the excess supply of dollars. This is a sit-uation where the foreign demand for goods, services, andfinancial assets from the European Union exceeds the Eu-ropean demand for foreign goods, services, and financialassets. If the supply of dollars rises from SS to S'S', ex-cess supply is created to the extent of ab. The ECB willbuy ab dollars in exchange for euros to maintain the limit

within the band. Under a floating exchange rate system,equilibrium would again have been achieved at e.When the ECB buys dollars in this manner, its officialdollar reserves increase and domestic money supply ex-pands, which may lead to inflation. To prevent this, theECBmay sell government bonds and thus counter the risein money supply.When the ECB starts accumulating excess reserves, itmay also revalue the euro in order to reduce the excesssupply of dollars, i.e., narrow the gap between the equilib-rium and fixed rates. This is the opposite of devaluation.

4 Types of fixed exchange rate sys-tems

4.1 The gold standard

Under the gold standard, a country’s government declaresthat it will exchange its currency for a certain weight ingold. In a pure gold standard, a country’s government de-clares that it will freely exchange currency for actual goldat the designated exchange rate. This “rule of exchange”allows anyone to go the central bank and exchange coinsor currency for pure gold or vice versa. The gold standardworks on the assumption that there are no restrictions oncapital movements or export of gold by private citizensacross countries.Because the central bank must always be prepared to giveout gold in exchange for coin and currency upon demand,it must maintain gold reserves. Thus, this system ensuresthat the exchange rate between currencies remains fixed.For example, under this standard, a £1 gold coin in theUnited Kingdom contained 113.0016 grains of pure gold,while a $1 gold coin in the United States contained 23.22grains. The mint parity or the exchange rate was thus: R= $/£ = 113.0016/23.22 = 4.87.[6] The main argument infavor of the gold standard is that it ties the world pricelevel to the world supply of gold, thus preventing inflationunless there is a gold discovery (a gold rush, for example).

4.2 Price specie flow mechanism

The automatic adjustment mechanism under the goldstandard is the price specie flow mechanism, which op-erates so as to correct any balance of payments disequi-librium and adjust to shocks or changes. This mecha-nism was originally introduced by Richard Cantillon andlater discussed by David Hume in 1752 to refute themercantilist doctrines and emphasize that nations couldnot continuously accumulate gold by exporting more thantheir imports.The assumptions of this mechanism are:

1. Prices are flexible

4 5 HYBRID EXCHANGE RATE SYSTEMS

2. All transactions take place in gold

3. There is a fixed supply of gold in the world

4. Gold coins are minted at a fixed parity in each coun-try

5. There are no banks and no capital flows

Adjustment under a gold standard involves the flow ofgold between countries resulting in equalization of pricessatisfying purchasing power parity, and/or equalization ofrates of return on assets satisfying interest rate parity atthe current fixed exchange rate. Under the gold standard,each country’s money supply consisted of either gold orpaper currency backed by gold. Money supply wouldhence fall in the deficit nation and rise in the surplus na-tion. Consequently, internal prices would fall in the deficitnation and rise in the surplus nation, making the exportsof the deficit nation more competitive than those of thesurplus nations. The deficit nation’s exports would be en-couraged and the imports would be discouraged till thedeficit in the balance of payments was eliminated.[13]

In brief:Deficit nation: Lower money supply → Lower internalprices → More exports, less imports → Elimination ofdeficitSurplus nation: Higher money supply → Higher internalprices → Less exports, more imports → Elimination ofsurplus

4.3 Reserve currency standard

In a reserve currency system, the currency of anothercountry performs the functions that gold has in a goldstandard. A country fixes its own currency value to a unitof another country’s currency, generally a currency thatis prominently used in international transactions or is thecurrency of a major trading partner. For example, sup-pose India decided to fix its currency to the dollar at theexchange rate E₹/$ = 45.0. To maintain this fixed ex-change rate, the Reserve Bank of India would need tohold dollars on reserve and stand ready to exchange ru-pees for dollars (or dollars for rupees) on demand at thespecified exchange rate. In the gold standard the centralbank held gold to exchange for its own currency, with areserve currency standard it must hold a stock of the re-serve currency.Currency board arrangements are the most widespreadmeans of fixed exchange rates. Under this, a nation rigidlypegs its currency to a foreign currency, special drawingrights (SDR) or a basket of currencies. The central bank’srole in the country’s monetary policy is thereforeminimal.CBAs have been operational in many nations like

• Hong Kong (since 1983);

• Argentina (1991 to 2001);

• Estonia (1992 to 2010);

• Lithuania (1994 to 2014);

• Bosnia and Herzegovina (since 1997);

• Bulgaria (since 1997);

• Bermuda (since 1972);

• Denmark (since 1945);

• Brunei (since 1967) [14]

4.4 Gold exchange standard

The fixed exchange rate system set up after World WarII was a gold-exchange standard, as was the system thatprevailed between 1920 and the early 1930s.[15] A goldexchange standard is a mixture of a reserve currency stan-dard and a gold standard. Its characteristics are as fol-lows:

• All non-reserve countries agree to fix their exchangerates to the chosen reserve at some announced rateand hold a stock of reserve currency assets.

• The reserve currency country fixes its currency valueto a fixed weight in gold and agrees to exchange ondemand its own currency for gold with other centralbanks within the system, upon demand.

Unlike the gold standard, the central bank of the reservecountry does not exchange gold for currency with the gen-eral public, only with other central banks.

5 Hybrid exchange rate systems

The current state of foreign exchange markets does notallow for the rigid system of fixed exchange rates. At thesame time, freely floating exchange rates expose a coun-try to volatility in exchange rates. Hybrid exchange ratesystems have evolved in order to combine the character-istics features of fixed and flexible exchange rate systems.They allow fluctuation of the exchange rates without com-pletely exposing the currency to the flexibility of a freefloat.

5.1 Basket-of-currencies

Countries often have several important trading partnersor are apprehensive of a particular currency being toovolatile over an extended period of time. They can thuschoose to peg their currency to a weighted average of sev-eral currencies (also known as a currency basket) . Forexample, a composite currency may be created consisting

5.5 Dollarization/Euroization 5

of hundred rupees, 100 Japanese yen and one U.S. dol-lar the country creating this composite would then needto maintain reserves in one or more of these currenciesto satisfy excess demand or supply of its currency in theforeign exchange market.A popular and widely used composite currency is theSDR, which is a composite currency created by theInternational Monetary Fund (IMF), consisting of a fixedquantity of U.S. dollars, euros, Japanese yen, and Britishpounds.

5.2 Crawling pegs

In a crawling peg system a country fixes its exchange rateto another currency or basket of currencies. This fixedrate is changed from time to time at periodic intervalswith a view to eliminating exchange rate volatility to someextent without imposing the constraint of a fixed rate.Crawling pegs are adjusted gradually, thus avoiding theneed for interventions by the central bank (though it maystill choose to do so in order to maintain the fixed rate inthe event of excessive fluctuations).

5.3 Pegged within a band

A currency is said to be pegged within a band when thecentral bank specifies a central exchange rate with refer-ence to a single currency, a cooperative arrangement, or acurrency composite. It also specifies a percentage allow-able deviation on both sides of this central rate. Depend-ing on the band width, the central bank has discretion incarrying out its monetary policy. The band itself may bea crawling one, which implies that the central rate is ad-justed periodically. Bands may be symmetrically main-tained around a crawling central parity (with the bandmoving in the same direction as this parity does). Al-ternatively, the band may be allowed to widen graduallywithout any pre-announced central rate.

5.4 Currency boards

A currency board (also known as 'linked exchange ratesystem”) effectively replaces the central bank through alegislation to fix the currency to that of another country.The domestic currency remains perpetually exchangeablefor the reserve currency at the fixed exchange rate. As theanchor currency is now the basis for movements of thedomestic currency, the interest rates and inflation in thedomestic economy would be greatly influenced by thoseof the foreign economy to which the domestic currency istied. The currency board needs to ensure themaintenanceof adequate reserves of the anchor currency. It is a stepaway from officially adopting the anchor currency (termedas dollarization or euroization).

5.5 Dollarization/Euroization

This is the most extreme and rigid manner of fixing ex-change rates as it entails adopting the currency of anothercountry in place of its own. The most prominent exampleis the eurozone, where 19 European Union (EU) memberstates have adopted the euro (€) as their common cur-rency. Their exchange rates are effectively fixed to eachother.There are similar examples of countries adopting the U.S.dollar as their domestic currency: British Virgin Islands,Caribbean Netherlands, East Timor, Ecuador, El Sal-vador, Marshall Islands, Federated States of Micronesia,Palau, Panama, and the Turks and Caicos Islands.(See ISO 4217 for a complete list of territories by cur-rency.)

6 Advantages• A fixed exchange rate may minimize instabilities inreal economic activity[16]

• Central banks can acquire credibility by fixing theircountry’s currency to that of a more disciplined na-tion [16]

• On amicroeconomic level, a country with poorly de-veloped or illiquid money markets may fix their ex-change rates to provide its residents with a syntheticmoney market with the liquidity of the markets ofthe country that provides the vehicle currency[16]

• A fixed exchange rate reduces volatility and fluctu-ations in relative prices

• It eliminates exchange rate risk by reducing the as-sociated uncertainty

• It imposes discipline on the monetary authority

• International trade and investment flows betweencountries are facilitated

• Speculation in the currency markets is likely to beless destabilizing under a fixed exchange rate systemthan it is in a flexible one, since it does not amplifyfluctuations resulting from business cycles

• Fixed exchange rates impose a price discipline onnations with higher inflation rates than the rest ofthe world, as such a nation is likely to face persis-tent deficits in its balance of payments and loss ofreserves [6]

7 Disadvantages

The main criticism of a fixed exchange rate is that flexi-ble exchange rates serve to adjust the balance of trade.[17]

6 10 REFERENCES

When a trade deficit occurs under a floating exchangerate, there will be increased demand for the foreign(rather than domestic) currency which will push up theprice of the foreign currency in terms of the domestic cur-rency. That in turn makes the price of foreign goods lessattractive to the domestic market and thus pushes downthe trade deficit. Under fixed exchange rates, this auto-matic rebalancing does not occur.Governments also have to invest many resources in get-ting the foreign reserves to pile up in order to defend thepegged exchange rate. Moreover, a government, whenhaving a fixed rather than dynamic exchange rate, can-not use monetary or fiscal policies with a free hand. Forinstance, by using reflationary tools to set the economyrolling (by decreasing taxes and injecting more money inthe market), the government risks running into a tradedeficit. This might occur as the purchasing power of acommon household increases along with inflation, thusmaking imports relatively cheaper.Additionally, the stubbornness of a government in de-fending a fixed exchange rate when in a trade deficit willforce it to use deflationary measures (increased taxationand reduced availability of money), which can lead tounemployment. Finally, other countries with a fixed ex-change rate can also retaliate in response to a certaincountry using the currency of theirs in defending theirexchange rate.Other noted disadvantages:

• The need for a fixed exchange rate regime is chal-lenged by the emergence of sophisticated derivativesand financial tools in recent years, which allow firmsto hedge exchange rate fluctuations

• The announced exchange rate may not coincide withthe market equilibrium exchange rate, thus leadingto excess demand or excess supply

• The central bank needs to hold stocks of both for-eign and domestic currencies at all times in order toadjust and maintain exchange rates and absorb theexcess demand or supply

• Fixed exchange rate does not allow for automaticcorrection of imbalances in the nation’s balanceof payments since the currency cannot appreci-ate/depreciate as dictated by the market

• It fails to identify the degree of comparative ad-vantage or disadvantage of the nation and may leadto inefficient allocation of resources throughout theworld

• There exists the possibility of policy delays and mis-takes in achieving external balance

• The cost of government intervention is imposedupon the foreign exchange market [6]

8 Fixed exchange rate regime ver-sus capital control

The belief that the fixed exchange rate regime bringswith it stability is only partly true, since speculative at-tacks tend to target currencies with fixed exchange rateregimes, and in fact, the stability of the economic systemis maintained mainly through capital control. A fixed ex-change rate regime should be viewed as a tool in capitalcontrol.

9 See also• Category:Fixed exchange rate (lists currentlypegged currencies)

• Exchange rate regime

• Floating exchange rate

• Linked exchange rate

• Managed float regime

• Gold standard

• Bretton Woods system

• Nixon Shock

• Smithsonian Agreement

• Foreign exchange fixing

• Currency union

• Black Wednesday

• Capital control

• Convertibility

• Currency board

• Impossible trinity

• Speculative attack

• Swan diagram

10 References[1] Dornbusch, Rüdiger; Fisher, Stanley; Startz, Richard

(2011). Macroeconomics (Eleventh ed.). New York:McGraw-Hill/Irwin. ISBN 978-0-07-337592-2.

[2] Goodman, Peter S. (2005-07-22). “China Ends Fixed-Rate Currency”. Washington Post. Retrieved 2010-05-06.

[3] Bordo, Michael D.; Christl, Josef; Just, Christian; James,Harold (2004). OENB Working Paper (no. 92) (PDF).

11.1 News articles 7

[4] Cohen, Benjamin J, “Bretton Woods System”, RoutledgeEncyclopedia of International Political Economy

[5] Kreinin, Mordechai (2010). International Economics: APolicy Approach. Pearson Learning Solutions. p. 438.ISBN 0-558-58883-2.

[6] Salvatore, Dominick (2004). International Economics.John Wiley & Sons. ISBN 978-81-265-1413-7.

[7] Bordo, Michael (1999). Gold Standard and RelatedRegimes: Collected Essays. Cambridge University Press.ISBN 0-521-55006-8.

[8] White, Lawrence. Is the Gold Standard Still the Gold Stan-dard among Monetary Systems?, CATO Institute BriefingPaper no. 100, 8 Feb 2008

[9] Dooley, M.; Folkerts-Landau, D.; Garber, P. (2009).“Bretton Woods Ii Still Defines the International Mone-tary System”. Pacific Economic Review 14 (3): 297–311.doi:10.1111/j.1468-0106.2009.00453.x.

[10] Goodman, Peter S. (2005-07-27). “Don't Expect Yuan ToRise Much, China Tells World”. Washington Post. Re-trieved 2010-05-06.

[11] Griswold, Daniel (2005-06-25). “Protectionism No Fixfor China’s Currency”. Cato Institute. Retrieved 2010-05-06.

[12] O'Connell, Joan (1968). “An International AdjustmentMechanism with Fixed Exchange Rates”. Economica35 (139): 274–282. doi:10.2307/2552303. JSTOR2552303.

[13] Cooper, R.N. (1969). International Finance. PenguinPublishers. pp. 25–37.

[14] Salvatore, Dominick; Dean, J; Willett,T. The Dollarisa-tion Debate (Oxford University Press, 2003)

[15] Bordo, M. D.; MacDonald, R. (2003). “The inter-wargold exchange standard: Credibility and monetary inde-pendence”. Journal of International Money and Finance22: 1. doi:10.1016/S0261-5606(02)00074-8.

[16] Garber, Peter M.; Svensson, Lars E. O. (1995). “The Op-eration and Collapse of Fixed Exchange Rate Regimes”.Handbook of International Economics 3. Elsevier. pp.1865–1911. doi:10.1016/S1573-4404(05)80016-4.

[17] Suranovic, Steven (2008-02-14). International FinanceTheory and Policy. Palgrave Macmillan. p. 504.

11 External links1. http://internationalecon.com/Finance/Fch80/

F80-1.php

2. http://www.wellesley.edu/Economics/weerapana/econ213/econ213pdf/lect213-05.pdf

3. Gavin, F. J. (2002). “The Gold Battles within theCold War: American Monetary Policy and the De-fense of Europe, 1960–1963”. Diplomatic History26 (1): 61–94. doi:10.1111/1467-7709.00300.

4. http://people.ucsc.edu/~{}mpd/InternationalFinancialStability_update.pdf

5. http://www.polsci.ucsb.edu/faculty/cohen/inpress/bretton.html

6. http://www.imf.org/external/pubs/ft/issues13/index.htm

7. http://www.imf.org/external/pubs/ft/issues/issues38/ei38.pdf

8. http://www.cato.org/pubs/bp/bp100.pdf

9. http://econ.la.psu.edu/~{}bickes/goldstd.pdf

10. Exchange Rate Regimes Past, Present and Future atthe Wayback Machine (archived April 11, 2010)

11. Reinhart, C. M.; Rogoff, K. S. (2004).“The Modern History of Exchange Rate Ar-rangements: A Reinterpretation”. QuarterlyJournal of Economics 119 (1): 1–48.doi:10.1162/003355304772839515.

12. Exchange Rate Regimes and International Reservesat the Wayback Machine (archived July 26, 2011)

11.1 News articles

1. http://www.washingtonpost.com/wp-dyn/content/article/2005/07/26/AR2005072600681.html

2. http://www.forexrealm.com/forex-analytics/exchange-rates/exchange-rate-regimes.html

3. http://www.gold-eagle.com/greenspan011098.html

4. http://www.washingtonpost.com/wp-dyn/content/article/2005/07/21/AR2005072100351.html

8 12 TEXT AND IMAGE SOURCES, CONTRIBUTORS, AND LICENSES

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