Title: Top Exchange Rates Pegged to the U.S. Dollar
Headings: Top Exchange Rates Pegged to the U.S. Dollar
Top Exchange Rates Pegged to the U.S. Dollar
Key Takeaways
What Does Pegging Mean?
Bretton Woods Agreement
Fixed vs. Floating Currencies
Why Currencies Peg to the U.S. Dollar
Major Fixed Currencies
The Bottom Line
Article Sources

Content: Most developing or emerging market economies use fixed exchange rates for their currencies. This provides exporting and importing countries more stability, and also keeps interest rates low. 2 ﻿
Why Currencies Peg to the U.S. Dollar
Countries have different reasons for pegging to the dollar. Most of the Caribbean islands—Aruba, Bahamas, Barbados, and Bermuda, to name a few—peg their currencies to the U.S. dollar because their main source of income is derived from tourism paid in dollars. 3 ﻿﻿ 4 ﻿ Fixing to the U.S. dollar stabilizes their economies and makes them less volatile. In Africa, many countries peg to the euro. The exceptions being Djibouti and Eritrea which peg their own currencies to the U.S. dollar. In the Middle East, many countries including Jordan, Oman, Qatar, Saudi Arabia, and the United Arab Emirates peg to the U.S. dollar for stability—the oil-rich nations need the United States as a major trading partner for oil. 4 ﻿
In Asia, Macau and Hong Kong fix to the U.S. dollar. 4 ﻿ China, on the other hand, has been embroiled in controversy about its currency policy.