Countries usually do not have difficulty maintaining a pegged exchange rate, even when they are experiencing major political or economic problems.

Question

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Pegged exchange rate systems are often difficult to maintain, especially during times of economic or political crisis. Countries may struggle to keep up with the required currency interventions and may face pressure from market speculators, leading to a devaluation of their currency. There have been many instances of countries abandoning their pegged exchange rates due to these challenges.

Countries Usually Do Not Have Difficulty Maintaining a Pegged Exchange