In the fixed exchange rate system, the exchange rate is fixed according to the gold content.
In this case, the exchange rate is either adjusted to the input and output of gold, or fluctuates within legal limits under the control of the Monetary Authority and is therefore relatively stable.
Floating exchange rate system Floating exchange rate system is relative to fixed exchange rate system.
This means that countries do not set gold parity and exchange rate fluctuations between their currencies and foreign currencies, and officials are not obliged to maintain exchange rate volatility limits, but allow exchange rates to float freely in response to supply and demand.
Under this system, it becomes a special commodity in the international financial market, and the exchange rate also becomes the price of buying and selling this commodity.
