What role for exchange rate policy?

In the majority of advanced economies, policymakers allow the exchange rate to be determined by the currency markets. We think they are likely to continue doing so for the foreseeable future, for several reasons. First, there is not currently a strong rationale for currency market intervention in most economies. Second, there is a long-standing consensus in the G7 in favour of floating exchange rates. And third, unconventional monetary policy provides an alternative mechanism to boost growth and inflation.