The formal adoption and universal implementation of the floating exchange rate system began after the intensification of the US dollar crisis in the late 1970s. The floating exchange rate system can be divided into free floating (also known as "clean floating") and management floating (also known as "dirty floating") according to whether the state intervenes in the foreign exchange market. In fact, no country is completely free to float today, and major developed countries have intervened in the foreign exchange market to varying degrees. At present, there are various forms to manage the floating exchange rate system, which can be divided into separate floating and joint floating, as well as some floating exchange rate systems with pegged policies. Under the floating exchange rate system, a country's exchange rate changes are influenced by many factors, including political and psychological factors in addition to economic factors. The main advantages of floating exchange rate system are to prevent the impact of international hot money and avoid the outbreak of currency crisis; Conducive to promoting the growth of international trade and the development of production; Conducive to promoting the flow of funds and so on. The disadvantage is that it often leads to fluctuations in the foreign exchange market, which is not conducive to long-term international trade and investment; Not conducive to the stability of the financial market; The international monetary fund's supervision of exchange rate is weak, and the imbalance of international payments remains unresolved; It is even more unfavorable to developing countries. Floating exchange rate system means that the central bank of a country does not stipulate the official exchange rate between its own currency and other countries' currencies, but allows the exchange rate to be determined spontaneously by the foreign exchange market. Under the floating exchange rate system, the main factors affecting the exchange rate are: the value represented by the currency itself, a country's balance of payments, interest rates, the intervention of governments and central banks in the foreign exchange market, politics, psychology, speculation and other factors.