Although the fixed exchange rate
made imports cheap, it caused a constant flight of dollars out of the country and a shrinking of industrial infrastructure, leading to job losses.
The study, conducted by Arbah Financial Company, attributed the local factors to the increase in demand due to lavish government spending and to the large size of credit extended to the private sector while the foreign factors are caused by what it called "imported inflation" for which the fixed exchange rate
of the riyal against the dollar was responsible in addition to the rising costs of commodities in the countries of origin.
Five of the six countries covered by HSBC's quarterly Gulf business confidence survey maintain a fixed exchange rate
to the US dollar, which has fallen almost 20pc against the euro since the start of 2007.
Interestingly, this excess return has increased after the collapse of the Bretton Woods fixed exchange rate
The discussion of monetary policy and capital flows almost inevitably begins with the well-known trilemma, the observation that a country can choose no more than two of the following three features of its policy regime: (1) free capital mobility across borders, (2) a fixed exchange rate
, and (3) an independent monetary policy.
Heavy intervention was witnessed in the beginning of 1973 by developed economies to smoothly shift from the Bretton Woods fixed exchange rate
system to free float.
Pursuant to the merger agreement, shareholders of Dow received a fixed exchange rate
South Sudan floated the fixed exchange rate
in December 2015 and there is no official foreign currencies rate set by the government since then.
JEDDAH: Saudi Arabia is committed to keeping the riyal pegged to the US dollar and that it has "sufficient tools" to support its fixed exchange rate
policy, said Ahmed Al-Kholifey, governor of Saudi Arabian Monetary Agency (SAMA), on Friday.
The bank said that it is committed to keep the riyal pegged to the US dollar and that it had 'sufficient tools' to support its fixed exchange rate
Al-Khalifi said that SAMA has already emphasized on different occasions to continue its policy of the current exchange rate of Saudi Riyal, and that it has sufficient tools to support SAR exchange rate, noting that this adopted policy of a fixed exchange rate
since more than three decades has been and still remains as an important pillar in supporting the Kingdom of Saudi Arabia's economy.
Bulgaria operates a fixed exchange rate
mechanism called currency board, which curbs the conduct of independent monetary policy by the country's central bank and the pegs the national currency, the lev, at 1.