Key Diagrams - Semi-Fixed and Fixed Exchange Rates

In this short revision video we use supply and demand analysis to explain semi-fixed exchange rate systems.

In a semi-fixed currency system, the exchange rate is allowed to fluctuate day-to-day between a specified range before a nation’s central bank will intervene to help bring a currency back within target range. The frequency with which this happens depends on the width of the band of fluctuation given to a currency.

IMF Survey of Currency Systems (2021)

Countries with a semi-fixed exchange rate:

• Singapore
• Bangladesh
• Ethiopia
• Rwanda
• Romania
• Costa Rica

IMF Survey of Currency Systems (2021)

Countries with a fully-fixed exchange rate:

• Bahamas (fixed to US dollar)
• Saudi Arabia (fixed to US dollar)
• Denmark (fixed to the Euro)
• Senegal (fixed to the Euro) – part of WAEMU
• Nepal (fixed to a composite basket ofcurrencies)