But the exchange rate is an important relative price in our economy and we pay very close attention to its movements. Movements in the exchange rate influence the levels of imports and exports, which can help to keep total demand and supply in balance, and have a direct influence on price levels in our economy.
Further, exchange rate movements act as a signal to shift resources into sectors where demand is strongest. Our floating exchange rate helps to facilitate that process. That said, we recognize that these types of adjustment can be, and have been, difficult for some sectors and regions of the country.