Currency Band

外汇网2021-06-19 14:10:16 39

A currency system that establishes a trading range that a currency's exchange rate can float between. A currency band repsents the price floor and ceiling within which the price of a given currency can trade, and is like a hybrid of a fixed exchange rate and a floating exchange rate. The currency band restricts how much the price can move relative to a reference currency or currencies.

|||If the value of the currency begins trading outside the band, then the country of that currency will usually revert to a fixed exchange rate. This usually stablizes the currency's price back within the band. The Chinese yuan is an example of a currency that moves within a currency band.

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