Finance

Floating Exchange Rate

Floating Exchange Rate

Floating Exchange Rate is a country’s exchange charge regime where its currency is determined by the foreign-exchange marketplace through supply and demand for particular currency in accordance with other currencies. Thus, floating exchange rates change freely and so are determined by trading in the foreign currency market. This is unlike a “fixed change rate” regime. A currency that works on the floating exchange rate is actually a floating currency. A floating currency is contrasted using a fixed currency.