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Finance Dictionary and Glossary of Investment Terms
floating exchange rate
Definition 1.
Currency exchange rate which is determined by free market forces, rather than being fixed by a government.
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Definition 2.
A country's decision to allow its currency value to change freely. The currency is not constrained by central bank intervention and does not have to maintain its relationship with another currency in a narrow band. The currency value is determined by trading in the foreign exchange market.
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