Answer-IMF describing India’s FX regime as “crawl-like” rather than purely floating implies ______

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Answer-IMF describing India’s FX regime as “crawl-like” rather than purely floating implies ______​

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Currency adjusts gradually based on inflation differentials often leading to a crawling depreciation is a primary characteristic of a crawl-like arrangement described by the IMF.     The IMF classifying Indias foreign exchange FX regime as a crawl-like arrangement indicates that the Indian rupee is no longer considered to be fully floating, but rather that its exchange rate is allowed to adjust gradually along a specific, predictable, or creeping trend over time.      This classification, reclassified from stabilized in Nov 2025, implies    Managed Flexibility The Rupee is not strictly fixed, but the Reserve Bank of India RBI frequently intervenes to guide the exchange rate within a narrow margin usually 2 over a 6-month period, which is crawl-like.  Predictable Trend Instead of large, erratic fluctuations, the currency exhibits a steady, gradual change.  A Soft Management It represents a, Middle Ground between a rigid fixed rate and a free-floating rate.       Note The official classification is a managed float, but the crawl-like tag denotes a more passive, gradual depreciation path compared to a freely floating currency.

IMF describing India’s FX regime as “crawl-like”

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