Bretton Woods Agreement


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Related to Bretton Woods Agreement: gold standard, Bretton Woods conference, Smithsonian 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 ?
It would be too pat to merely proclaim that the Bretton Woods agreement brought about a time of economic prosperity, high productivity, high average wages and high consumption.
Freer trade doctrine had received underlying support in the Bretton Woods Agreement but the 'liberalisation' Nurkse mentions must be viewed in relation to the construction of extensive trade restrictions in the interwar era.
Stockman shows that even the famous "defender" of capitalism, Milton Friedman, became an agent of its destruction by advocating the end of the Bretton Woods agreement.
The latter were created in 1969, decades after the Bretton Woods Agreement, and have been used ever since as a sort of internal accounting device.
The Bretton Woods Agreement of 1944, which laid the institutional foundation for the post-war World War II economy, was made possible because the United States and Britain called the shots.
The Bretton Woods agreement of July 1944 established the rules for multilateral negotiations over economic policy, and created such institutions as the International Monetary Fund and the International Bank for Reconstruction and Development.
led by the G-7 where the US will be more equal than its six partners - conveniently called 'Bretton Woods-II', a revised version of the 1944 Bretton Woods Agreement heralded by French President Nicolas Sarkozy in late October 2008.
A transitional phase followed the annulment of the Bretton Woods Agreement, and a floating exchange rate of currency was subsequently adopted instead of the previous system mandating gold coverage for currencies.
He was referring to the Inter- national Monetary Fund and the World Bank, created by the 1944 Bretton Woods agreement, and bodies later created to regulate global trade.
The United States and other large industrial countries had fixed their exchange rates under the Bretton Woods Agreement Act in 1945, but the system did not become fully functional until the end of 1958.
In the first quarter-century of the post-World War II era, trade was held back by the constraints of fixed exchange rates imposed by the Bretton Woods Agreement.
Also included in the encyclopedia are 18 primary source documents (some only in excerpt), examples of which include Matthew Perry's Narrative of the Expedition of an American Squadron to the China Seas and Japan, Alexander Hamilton's Report on Manufactures, Adam Smith's The Wealth of Nations, Woodrow Wilson's "Fourteen Points" speech, the Bretton Woods Agreement, the General Agreement of Tariffs and Trade, and the preamble to the "Final Act" of the first United Nations Conference on Trade and Development, as well as a glossary.