Whenever the market believes there will be a depreciation (the peg will break) then:

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If the market believes there will be a depreciation, it means that the value of the currency is expected to decrease against other currencies. In this case, the benefits of depreciation (such as improved trade competitiveness) would outweigh the costs of depreciation (such as inflation). Therefore, it would be more beneficial to allow for the currency to depreciate instead of maintaining the peg.

Whenever the Market Believes There Will Be a Depreciation (The