A disadvantage of a managed float is that a country may lose control of domestic monetary policy at times.

Question

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In a managed float exchange rate system, a country's central bank may intervene in the foreign exchange market to stabilize or influence the currency's value. This intervention often requires using domestic monetary policy tools, such as adjusting interest rates or altering the money supply. Consequently, the country might lose some control over its domestic monetary policy, as these tools are being used to achieve exchange rate objectives rather than to directly manage the domestic economy.

A Disadvantage of a Managed Float Is That a Country