A managed float regime, also known as a dirty float, is a type of exchange rate regime where a currency's value is allowed to fluctuate in response to foreign-exchange market mechanisms (i.e., supply and demand), but the central bank or monetary authority of the country intervenes occasionally to stabilize or steer the currency's value in a particular direction. This is in contrast to a pure float where the value is entirely determined by market forces, and a fixed exchange rate where the value is pegged to another currency or a basket of currencies.
Under a managed float regime, the central bank might buy or sell its own currency in the foreign exchange market to counteract short-term fluctuations, to prevent excessive depreciation or appreciation, or to achieve certain economic goals such as controlling inflation or boosting exports.
In an increasingly integrated world economy, the currency rates impact any given country's economy through the trade balance. In this aspect, almost all currencies are managed since central banks or governments intervene to influence the value of their currencies. According to the International Monetary Fund, as of 2013, 82 countries and regions used a managed float, or 43% of all countries, constituting a plurality amongst exchange rate regime types.
International financial organizations, like the IMF, categorize countries' exchange rate regimes based on specific criteria, but these classifications aren't necessarily objective and may not fully capture the nuances of a country's exchange rate policies. For example, a country may normally have a floating exchange rate regime but intervene in times of extreme volatility, a country may formally claim to be following one exchange rate regime (de jure) while having another in practice (de facto).
For more detail on each country's exchange rate regime, it is recommended to read IMF's Annual Report on Exchange Arrangements and Exchange Restrictions.IMF's Annual Report on Exchange Arrangements and Exchange Restrictions
Countries with managed floating currencies
The below is a list of countries where, in 2022, the IMF has classified the regime as "Other managed arrangement" or "Stabilized arrangement", or where the IMF states that the de jure arrangement is a managed float. The IMF reclassifies the countries frequently based on the actions of their central banks.
In its annual report, the IMF also notes instances where central banks have intervened, even for countries where it still classifies the currency as free floating. For instance, the Japanese Ministry of Finance, it notes, has "intervened in the foreign exchange market in September 22, October 21, and October 24, 2022, to address excess volatility and disorderly exchange rate movement for the first time since 2011".
Source:IMF AREAER as of 2022
Country Stabilized arrangement Other managed arrangement De jure managed float de jure managed de jure managed Other managed Stabilized Stabilized Other managed Stabilized de jure managed de jure managed Other managed de jure managed de jure managed Other managed de jure managed de jure managed Other managed Stabilized Stabilized de jure managed Stabilized Other managed Stabilized Other managed de jure managed Other managed Other managed de jure managed Stabilized de jure managed Stabilized Stabilized Stabilized Stabilized de jure managed Other managed Stabilized Stabilized Stabilized de jure managed Stabilized de jure managed Other managed de jure managed Other managed Other managed Stabilized Other managed Stabilized de jure managed Stabilized Other managed de jure managed Stabilized Stabilized Other managed Other managed Stabilized de jure managed Other managed
See also December Mistake Black Wednesday Fixed exchange rate Floating exchange rate or floating currency
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