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Managed Exchange Rate
System where the exchange rate is mainly determined by market forces, but the central bank occasionally intervenes to keep it close to a desired level.
Overvalued Currency
Where the value of a currency is kept higher than its equilibrium level by government or central bank intervention.
Pegging Currency
Pegging currency means the central bank sets and maintains the value of the domestic currency relative to another currency.
Undervalued Currency
Situation where the currency’s value is kept lower than its equilibrium level, making exports cheaper and imports more expensive.