Meaning of crawling peg | Babel Free

Definitions

An exchange rate regime that allows depreciation or appreciation to happen gradually.

Examples

“Many analysts assume⟳ that a floating rate would have⟳ the same general tendency over time as a rate devaluing according to a crawling peg, but this is not certain. If the exchange⟳ rate is “undervalued,” for example, in the sense⟳ that foreign exchange⟳ is in excess supply⟳, a crawling-peg policy would preserve⟳ the undervaluation; a floating exchange⟳ rate would appreciate and therefore be less inflationary.”

““Many emerging-market economies have⟳ tried a number⟳ of technical devices: the fixed rate peg, varieties of crawling peg, currency boards and even dollarization,” Mr. Greenspan said in a recent speech. “The success has been mixed. Where successful, they have⟳ been backed by sound⟳ policies.””

CEFR level