 The system is a method to fully use the key attributes of the fixed exchange regimes as well as the flexibility of the floating exchange rate regime.The system is shaped to peg at a certain value but at the same time is designed to "glide" to respond to external market uncertainties.To react to external pressure (such as interest rate differentials or changes in foreign-exchange reserves) to appreciate or depreciate the exchange rate, the system can have moderately-sized, frequent exchange rate changes to ensure that the economic dislocation is minimized.