<Tr> <Td> <Ul> <Li> </Li> <Li> </Li> <Li> </Li> </Ul> </Td> </Tr> <Ul> <Li> </Li> <Li> </Li> <Li> </Li> </Ul> <P> A floating exchange rate (also called a fluctuating or flexible exchange rate) is a type of exchange - rate regime in which a currency's value is allowed to fluctuate in response to foreign - exchange market mechanisms . A currency that uses a floating exchange rate is known as a floating currency . A floating currency is contrasted with a fixed currency whose value is tied to that of another currency, material goods or to a currency basket . </P> <P> In the modern world, most of the world's currencies are floating; they include the most widely - traded currencies: the United States dollar, the Swiss Franc, the Indian rupee, the euro, the Japanese yen, the British pound, and the Australian dollar . However, central banks often participate in the markets to attempt to influence the value of floating exchange rates . The Canadian dollar most closely resembles a pure floating currency because the Canadian central bank has not interfered with its price since it officially stopped doing so in 1998 . The US dollar runs a close second, with very little change in its foreign reserves . In contrast, Japan and the UK intervene to a greater extent, and India has seen medium - range intervention by its central bank, the Reserve Bank of India . </P>

The us dollar freely floats against which of the following three major world currencies