This study investigates the structure and effectiveness of monetary transmission mechanisms under flexible exchange rate regimes, with particular emphasis on open and financially integrated economies. Unlike fixed or heavily managed systems, flexible regimes introduce an additional exchange rate channel that interacts dynamically with interest rate adjustments, credit conditions, asset prices, and expectations formation. The article develops a comprehensive analytical framework that distinguishes between traditional transmission channels such as the interest rate and bank lending channels and the exchange rate induced balance sheet and expectations channels that become more prominent under currency flexibility. The analysis highlights how exchange rate volatility, financial dollarization, capital flow sensitivity, and institutional credibility shape the speed and strength of policy transmission.