The policy of intervention in the foreign exchange market to smooth out short-run fluctuations in exchange rates is called:
A)crawling peg
B)adjustable peg
C)leaning against the wind
D)managed float

Question

Quizplus · Accepted Answer

The policy of intervention in the foreign exchange market to smooth out short-run fluctuations in exchange rates is called "leaning against the wind." This involves buying or selling currencies in the foreign exchange market in order to counteract short-term market movements. This approach is often used by central banks to stabilize their currency's value and maintain macroeconomic stability.

The Policy of Intervention in the Foreign Exchange Market to Smooth