Bretton Woods Agreement

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Related to Bretton Woods: Bretton Woods conference, gold standard, GATT, Bretton Woods Agreement

Bretton Woods Agreement

An agreement signed by the original United Nations members in 1944 that established the International Monetary Fund (IMF) and the post-World War II international monetary system of fixed exchange rates.

Bretton Woods Agreement

An international agreement on monetary and currency policy for the period following World War II. Initially crafted in 1944 while the war was ongoing, it came into effect the following year. Among other things, the Bretton Woods Agreement created the International Monetary Fund and the International Bank for Reconstruction and Development. The latter organization was created to finance post-war reconstruction, while the IMF was intended to stabilize exchanges rates between currencies and to serve as a country's lender of last resort.

A key component of the Bretton Woods Agreement was the requirement that all countries peg their currencies to a certain amount of gold. In practice, most currencies were pegged to the U.S. dollar, which was itself pegged to gold. This helped the IMF accomplish its stated goals to stabilize currencies that had experienced a large amount of wartime inflation. The Agreement worked relatively well until the United States unilaterally depegged from gold in 1971. See also: Keynesian economics, Nixon shock.
References in periodicals archive ?
Though the Bretton Woods institutions have disbursed billions in Africa since their foundation, China has had its share of involvement in the continent's development over the years.
According to White, the authorities in Buenos Aires had attempted to further clarify what they would have to do in order to join the Bretton Woods Institutions (New York Times 7 May 1946; Washington Post 7 May 1946).
This was true of the preparations for the Bretton Woods meeting.
The institutions came into being at the end of the Second World War, when 44 countries met in the resort town of Bretton Woods, US, in 1944.
The IMF is redefining the scope of conditionality (to deal with duplication of the other Bretton Woods institution, the World Bank) and there is a shift to neo-institutionalism, with today's second generation reforms.
In 1945, The Colliers Year Book reported on the Bretton Woods conference by saying that one of its major objectives, "Was to eliminate trade barriers, which, by hampering the free exchange of goods, have often been a contributory factor of wars.
It didn't finish at the neighbouring Bretton Woods resort until well into May this year).
Our financial institutions were established after Bretton Woods, after the Second World War.
1) The first treats the Bretton Woods system of fixed exchange rates.
The IMF and World Bank are part of the Bretton Woods system established in 1944 to devise rules of investment in the postwar era.
Yet by 1944 Keynes' faith was sufficiently restored that he played a leading role in creating the Bretton Woods institutions (the International Monetary Fund, the World Bank, and the General Agreement on Tariffs and Trade).
This was evidenced by their lack of awareness of the strong socialist tone that characterised Bretton Woods, the 1944 conference that created GATT, WTO's predecessor, as well as the other two entities that they vilified, the International Monetary Fund (IMF) and the World Bank.