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RBA Glossary definition for floating exchange rate

floating exchange rate – Exchange rates determined by market forces based on the demand for and supply of a currency.

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The Transmission of Terms of Trade Shocks

16 Oct 2009 RDP 2009-05
Dan Andrews and Daniel Rees
t. Floating exchange rate. t1. 0.09. 0.07. σ Terms of trade. ... t1. 0.03. 0.00. σ Terms of trade. t. Floating exchange rate.
https://www.rba.gov.au/publications/rdp/2009/2009-05/transmission-terms.html

Appendix C: Additional Results

16 Oct 2009 RDP 2009-05
Dan Andrews and Daniel Rees
σ Terms of trade. t. Floating exchange rate. t1. 0.15. 0.13. ... σ Terms of trade. t. Floating exchange rate. t1. 0.16. 0.14.
https://www.rba.gov.au/publications/rdp/2009/2009-05/appendix-c.html

Data and Methodology

16 Oct 2009 RDP 2009-05
Dan Andrews and Daniel Rees
Our measure of exchange rate flexibility is a dummy variable that takes a value of one if an economy has a floating or managed floating exchange rate according to the de ... 49. 38. 2. 222. Floating exchange rate dummy. (c). 0.30. 0.46.
https://www.rba.gov.au/publications/rdp/2009/2009-05/data-methodology.html

The Impact of Terms of Trade Volatility on Macroeconomic Volatility

16 Oct 2009 RDP 2009-05
Dan Andrews and Daniel Rees
lower in economies with floating exchange rates than in economies with fixed exchange rate regimes. ... lower in economies with floating exchange rates than fixed exchange rate regimes (see Regression [6.2]).
https://www.rba.gov.au/publications/rdp/2009/2009-05/impact-terms-trade-volatility-macroeconomic.html

Robustness Checks

16 Oct 2009 RDP 2009-05
Dan Andrews and Daniel Rees
While excluding OPEC oil producers from our sample also produced qualitatively similar results, the floating exchange rate interaction term became significant at the 13 per cent level. ... As Table C4 shows, the interaction term on strict monetary policy
https://www.rba.gov.au/publications/rdp/2009/2009-05/robustness-checks.html

Conclusion

16 Oct 2009 RDP 2009-05
Dan Andrews and Daniel Rees
While there is evidence that monetary policy frameworks that focus on low inflation tend to reduce macroeconomic volatility in general, floating exchange rates seem to be the key to lower macroeconomic ... Monetary policy that focuses on low inflation
https://www.rba.gov.au/publications/rdp/2009/2009-05/conclusion.html

Literature

16 Oct 2009 RDP 2009-05
Dan Andrews and Daniel Rees
is much larger in economies with fixed exchange rates than economies with floating exchange rates. ... If real wages are inflexible, the ability of floating exchange rates to temper the effect of terms of trade shocks on macroeconomic volatility becomes
https://www.rba.gov.au/publications/rdp/2009/2009-05/literature.html

Appendix A: Data Descriptions and Sources

16 Oct 2009 RDP 2009-05
Dan Andrews and Daniel Rees
Exchange rate flexibility: Dummy variable taking a value of one if an economy's exchange rate regime is classified as either floating or managed floating according to Reinhart and Rogoff (2004),
https://www.rba.gov.au/publications/rdp/2009/2009-05/appendix-a.html

Introduction

16 Oct 2009 RDP 2009-05
Dan Andrews and Daniel Rees
floating exchange rates appear to provide the key macroeconomic stabilisation tool for economies that are subject to sizeable terms of trade shocks. ... However, the role that monetary policy plays in reducing inflation volatility could occur through
https://www.rba.gov.au/publications/rdp/2009/2009-05/introduction.html