Tiniest Developed Economy Ponders Testing Currency Markets

Iceland, the world’s tiniest developed economy, is now pondering whether it has the might to take on the currency markets.

The center-right coalition that took office this month wants an overhaul of Iceland’s monetary policy framework, which could lead to fixing the currency or letting it trade within a band, Finance Minister Benedikt Johannesson, 61, said. The review could also lead to a less intrusive move, namely continuing the current managed intervention. It could also result in the most drastic action of all, abandoning the krona for another currency, he said.