Iceland's Currency Speculation Opens Rift in Ruling Coalition

  • Prime minister sees free float as key to economic adjustment
  • Iceland has appointed panel to explore monetary policy options
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As they search for a permanent exchange-rate framework, Iceland’s policy makers are finding they may disagree on some pretty fundamental issues.

Power politics in the 340,000-people nation are being laid bare, as the nation’s prime minister, who heads the establishment Independence Party, and its finance minister, a former publishing executive who leads the newly created Reform Party, are pushing different messages on the currency regime that Iceland may adopt.