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The case for a floating exchange rate includes monetary policy autonomy, trade balance adjustments, and crisis...

The case for a floating exchange rate includes monetary policy autonomy, trade balance adjustments, and crisis recovery issues. The case for a fixed exchange rate includes monetary discipline, speculation issues, uncertainty, trade balance adjustments and economic recovery. We conclude these topics with a short section on “who is right” without actually addressing this very complex issue. But, what do you think? Who is right? Should we have a floating or fixed exchange rate system?

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Unfortunately, there is no exact answer on if we should have a floating or fixed exchange rate system. In reality, when the Economic advisors and the Central Bank of the country make such decisions, a number of factors are incorporated such as the gold reserves, country's economic state etc. Although, given the information and data through previous researches, it can be concluded that floating exchange rate system has a long-term upper-hand throughout economies.

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