However, intervention still frequently occurs in emerging market economies, but intervention in developed countries, if and when it takes place, is often limited to ensuring orderly conditions for the movement in exchange rates. Indeed, increasingly, intervention is seen as having little lasting power to influence the real exchange rate and thus competitive conditions for the tradable sector.
Intervention can be used, however, to supply liquidity to the foreign exchange markets or to influence the level of foreign exchange reserves. When foreign exchange reserves are not needed A country with a hard currency, such as the US dollar, sterling or the euro, has little need to be concerned about the level of foreign exchange reserves. Their currencies are acceptable across the globe.