Title: Currency board - Wikipedia
Headings: Currency board
Currency board
Contents
Features of "orthodox" currency boards
Consequences of adopting a fixed exchange rate as prime target
Pros and cons
Examples in recent history
Examples against the euro
Examples against the U.S. dollar
Examples against the pound sterling
Examples against other currencies
Historical examples
See also
References
Further reading
External links

Content: The growth of the domestic money supply can now be coupled to the additional deposits of the banks at the central bank that equals additional hard foreign exchange reserves in the hands of the central bank. Pros and cons
The virtue of this system is that questions of currency stability no longer apply. The drawbacks are that the country no longer has the ability to set monetary policy according to other domestic considerations, and that the fixed exchange rate will, to a large extent, also fix a country's terms of trade, irrespective of economic differences between it and its trading partners. Typically, currency boards have advantages for small, open economies which would find independent monetary policy difficult to sustain. They can also form a credible commitment to low inflation. Examples in recent history
Worldwide use of the U.S. dollar and the euro: United States
External adopters of the US dollar
Currencies pegged to the US dollar
Currencies pegged to the US dollar w/ narrow band
Eurozone
External adopters of the euro
Currencies pegged to the euro
Currencies pegged to the euro w/ narrow band
Note that the Belarusian ruble is pegged to the Euro, Russian Ruble and U.S. Dollar in a currency basket. More than 70 countries have had currency boards. Currency boards were most widespread in the early and mid 20th century. Worldwide official use of foreign currency or pegs.