pegged exchange rate
- noun
- Specialized
:
tipo de cambio fijo
- A pegged exchange rate helps stabilize a country's currency against fluctuations in the market.
Examples
-
Countries may choose to adopt a pegged exchange rate to ensure economic predictability.
-
Following the breakdown of the pegged exchange rate system, states collectively encouraged the further expansion of international capital movements.
Academic text (1995) -
The Bretton Woods Agreement of 1944 reestablished a system of pegged exchange rates.
Academic text (2018) -
There is nothing impractical about a nominally pegged exchange rate in the context of capital controls and reasonably flexible domestic prices.
Academic text (2004) -
A central bank can always preserve a pegged exchange rate, as Mexico's was at this time, through a sustained high interest rate or a contraction in the monetary base.
Academic text (1998) -
During the discussions leading up to the 1944 Bretton Woods Conference, one of the sticking points between the United States and Great Britain, the principal negotiators, involved the issue of official controls on short-term capital movements in a pegged exchange rate system.
Academic text (1995) -
Many central banks maintain a pegged exchange rate to support their economies during uncertain times.
Synonyms
1
5.4
A system where a government keeps a country's money at a set value, often linked to another currency or gold
Antonyms
- Specialized
1
5.2
A system where a currency's value changes because of buying and selling in the market, not set by the government
How Fixed
- Specialized
1
5.4
- Specialized
- Specialized
13
7.9
Surface Forms
Morphology
The meaning is directly compositional: 'pegged' (fixed/linked) applied to 'exchange rate' yields an exchange rate that is fixed or tied to another currency. This follows a standard adjectival/verb+noun pattern and has clear cross-linguistic parallels, so a B1 learner who knows the constituents can infer the meaning.
Etymology
Pegged exchange rate comes from the simple image of a peg holding something steady, like a wooden peg fixing a tent so it cannot move. So a Pegged exchange rate means a country's money is fixed to another country's money 'to keep its value steady'.