In fact, Danmarks Nationalbank has conducted a fixed-exchange-rate policy for more than three decades – first against the D-Mark and from 1999 against the euro. We recently celebrated the 30 years anniversary of the central rate. The legal framework is the European Exchange Rate Mechanism.
Officially, the krone may fluctuate by up to 2.25 per cent on either side of the central rate, but in practice Danmarks Nationalbank ensures that the fluctuations are far smaller. This reflects that Danmarks Nationalbank takes consistent action as the krone exchange rate starts drifting away from the central rate. The exchange rate peg is a cornerstone of Danish economic policy.