“As of today, China has continued to adopt the managed-floating exchange rate regime in the onshore market. The USD/CNY remains to be the top pair among all Yuan pairs and has the highest trading volume; at the same time, China’s Central Bank also looks to other CNY pairs when guide the onshore Yuan rate.” Nasdaq

Currency Stability

Some currencies in the world are more stable, and for emerging countries the national currency has a fixed exchange rate with another currency. 

For example, the nations in the ECCB use the EC Dollar which is pegged to the USD.

Some other nations which have a high GDP per capita also peg. for example Saudi Arabia.

Cuba did use the CUC but that is not operational now.

A related matter to monetary policy is the SDR which seeks to provide liquidity to countries in crisis. This was especially relevant in 2009.  

The SDR – Special Drawing Rights – controlled by the IMF but endorsed by central banks controlling the underlying currencies. 

Today it has 200 billion dollars and has 5 currencies – USD, GDP, Euro, RMB, JPY.

The Chinese currency (RMB) is split into the CNY (mainland use) and the CNH (traded). 

The CNY is pegged against the USD. 

 

 

 

 

By cryptorocks_editor

Editor.