A modest step towards fixed parities



Many authors welcomed the shift to floating exchange rates as they expected it to result in lower inflation, unemployment and balance of payments disequilibria. However, the new system exhibits two sharp daily fluctuations of exchange rates, imposing unwelcome risks on enterprises. Thus, the urge towards more stable exchange rates is becoming intense. The paper analyses the gradual stabilisation of exchange rates through the establishment of monetary zones.

JEL: F32, E31, F33


Floating exchange rates, inflation, balance of payments, monetary zones

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ISSN 2037-3643

Reg. Tribunale di Roma n.377/2009 del 19/11/2009