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Economic Commentary

Target Zones for Exchange Rates?

In recent years, growing dissatisfaction with the levels and the volatility of dollar exchange rates has led to calls for greater coordination of economic policies among nations and for an investigation into alternative exchange-rate systems. A number of economists and policymakers, for example, have advocated limiting the fluctuations of the dollar with a target-zone arrangement for exchange rates. Under such a proposal, countries would establish central exchange rates values for their currencies and would keep the actual exchange rates within a specific margin of the central values.

The views authors express in Economic Commentary are theirs and not necessarily those of the Federal Reserve Bank of Cleveland or the Board of Governors of the Federal Reserve System. The series editor is Tasia Hane. This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License. This paper and its data are subject to revision; please visit for updates.

Suggested Citation

Humpage, Owen F., and Nicholas V. Karamouzis. 1986. “Target Zones for Exchange Rates?” Federal Reserve Bank of Cleveland, Economic Commentary 8/1/1986.

This work by Federal Reserve Bank of Cleveland is licensed under Creative Commons Attribution-NonCommercial 4.0 International