A system that was operated by some central banks within the European Union, which intervened in exchange markets to limit the fluctuations of their currencies relative to one another, while letting all of them collectively float.
Europe's system to stabilize currency values by linking the value of all EC member currencies to the German Mark. The permitted fluctuation from the Mark was widened in August 1993 to give EC members more freedom to adjust economic policies in an attempt to end the European recession.
( ERM), or the currency grid, is a system that limits currency fluctuations to a range of 15 percent in either direction. Finance By Example (Archives): Italian Lira Re-Admitted into European Union