Under a ﬁxed exchange rate regime, the balance of payments account is adjusted for the extent of the government's intervention in the forex market. This is termed _____.

Question

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Under a fixed exchange rate regime, the balance of payments account is adjusted through official financing, which involves the government's intervention in the forex market to maintain the exchange rate at its fixed level. This can include activities such as buying or selling foreign currencies.

Under a ﬁXed Exchange Rate Regime, the Balance of Payments