Even countries with pegged

Expert Solution

Pagged countries exchange rate require a significant management structure.why pagging its currency a country can gain comparative trading advantage while protecting its own economic interests. Maintaining a pegged exchange rate usually requires a large amount of capital reserves.

For emerging economies with fixed exchange rate rising inflation can be particularly disasters. China's economic boom over the last decade has recessed it's on country and the world. Desh speed of growth require a change in monetary policy.in order to handle certain aspects of the economy effectively in particular export trade and consumer price inflation. But none of the country's growth rate could have been established without a fixed or pegged US dollar exchange rate.

Pagged rate can sometime lead to our long-term inflation. Do there are some risk associated with fixed exchange rate there are many advantages. pegged rate provide stability for countries that are particularly vulnerable and thus a strong platform for a country to grow economically.

Rahul Sunny answered 1 year ago

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Even countries with pegged

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