2.2 IMF classification of Currency Regimes

Since 2009 the IMF's exchange rate regime classification system uses a "de facto classification" methodology. Under this system, a country that has given up their own sovereignty over monetary policy is considered to have

• a residual agreement
• hard pegs
• soft pegs
• floating arrangements

Since 2009 the IMF's exchange rate regime classification system uses a "de facto classification" methodology. Under this system, countries with "fixed exchange rates" are considered to have

• residual agreement
• soft pegs
• hard pegs
• floating arrangements

A small economy country whose GDP is heavily dependent on trade with the United States could use a(n) ________ exchange rate regime to minimize the risk to their economy that could arise due to unfavorable changes in the exchange rate

• pegged exchange rate with the United States
• pegged exchange rate with the Euro
• independent floating
• managed float

Since 2009 the IMF's exchange rate regime classification system uses a "de facto classification" methodology. Under this system, currencies that are predominantly market-driven are considered to be

• soft pegs
• hard pegs
• floating arrangements
• residual agreement

Among IMF member countries since 2010 the dominating exchange rate regime has been

• hard peg
• soft peg
• floating arrangements
• residual agreement

The euro is an example of a rigidly fixed system, acting as a single currency for its member countries. However, the euro itself is an independently floating currency against all other currencies

• True
• False

Although the contemporary international monetary system is typically referred to as a "floating regime," it is clearly not the case for the majority of the world's nations

• True
• False

The IMF's methodology for classifying exchange rate regimes today is based on the official policy statement of the respective governments, de jure classification

• True
• False