An alternative to a central bank, often established in response to economic turmoil. A currency board, which generally includes some foreigners, replaces the central bank and sets a fixed exchange rate. Argentina instituted a currency board in April 1991, creating a new peso worth $1 and requiring the government to hold enough dollars in reserves so that every peso could be exchanged for a dollar. The move drastically cut inflation and also restored Argentina's ability to borrow money at reasonable interest rates. However, currency boards effectively strip a nation of the power to control its own economy. Economic factors such as wages, interest rates, the balance of payments, even rents, adjust to the fixed exchange rate.