African states should end fixed exchange rates, IMF official says

More credibility on monetary policy is best cure for “fear of floating”, Selassie argues

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Photo: Flickr/freeimage4life

Fixed exchange rate regimes in sub-Saharan Africa reflect a “fear of floating”, a senior International Monetary Fund (IMF) official said on June 7.

Relying on a fixed exchange rate limits policy flexibility and contains risks of sudden adjustments, the IMF’s African department head Abebe Aemro Selassie said.

“Increasing monetary policy credibility is the antidote to the fear of floating,” Selassie said. He called on African central banks to adopt a holistic approach to strike a balance between

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