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    Retton Agreement: Presented by Group 3 Ancheta, Alcoba, Carlos and Matthew

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    John Grey
    The Bretton Woods Agreement established the post-World War 2 international monetary system in 1944. It created fixed exchange rates where currencies were pegged to the U.S. dollar, which was convertible to gold. It also formed the IMF to provide loans to countries and the World Bank to support development. However, the system broke down in the early 1970s as the U.S. ran large deficits and its gold reserves decreased significantly.

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    Retton Agreement: Presented by Group 3 Ancheta, Alcoba, Carlos and Matthew

    Uploaded by

    John Grey
    89 views15 pages
    The Bretton Woods Agreement established the post-World War 2 international monetary system in 1944. It created fixed exchange rates where currencies were pegged to the U.S. dollar, which was convertible to gold. It also formed the IMF to provide loans to countries and the World Bank to support development. However, the system broke down in the early 1970s as the U.S. ran large deficits and its gold reserves decreased significantly.

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    The Bretton Woods Agreement established the post-World War 2 international monetary system in 1944. It created fixed exchange rates where currencies were pegged to the U.S. dollar, which was convertible to gold. It also formed the IMF to provide loans to countries and the World Bank to support development. However, the system broke down in the early 1970s as the U.S. ran large deficits and its gold reserves decreased significantly.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    89 views15 pages

    Retton Agreement: Presented by Group 3 Ancheta, Alcoba, Carlos and Matthew

    Uploaded by

    John Grey
    The Bretton Woods Agreement established the post-World War 2 international monetary system in 1944. It created fixed exchange rates where currencies were pegged to the U.S. dollar, which was convertible to gold. It also formed the IMF to provide loans to countries and the World Bank to support development. However, the system broke down in the early 1970s as the U.S. ran large deficits and its gold reserves decreased significantly.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    of 15

    BRETTON

    AGREEMENT
    Presented by group 3
    Ancheta, Alcoba , Carlos and Matthew
    WHAT IS THE
    BRETTON WOODS
    AGREEMENT
    The Bretton Woods
    Agreement is the
    landmark system for
    monetary and exchange
    rate management
    established in 1944 after
    the world war 2.
    It was developed at the United
    Nations Monetary and Financial
    Conference held in Bretton
    Woods, New Hampshire,
    currencies were pegged to the
    price of gold, and the U.S. dollar
    was seen as a reserve
    currency linked to the price of
    gold.
    Source:https://www.investopedia.com/terms/b/brettonwoodsagreement.asp
    “ALL CURRENCIES ENDED UP
    TO DOLLAR AND DOLLAR
    CONNECTS TO GOLD”
    SETTING UP THE
    BRETTON WOODS
    AGREEMENT
    Delegates from 44 countries met to
    create a new international monetary
    system. The main goals of the
    meeting of the 730 delegates were to
    ensure a foreign exchange rate
    system, prevent competitive
    devaluations and promote economic
    growth.
    TWO INTERNATIONAL
    INSTUTION CREATED
    DURING THE BRETTON
    AGREEMENT
     INTERNATIONAL MONETARY FUND
    (IMF) - suppose to lend countries that
    cannot find in any other resources

     INTENATIONAL BANK FOR


    RECONTRUCTION AND
    DEVELOPMENT (WORLD BANK) –
    suppose to help less develop country grow
    In 1958, the Bretton Woods system became
    fully functional. This happened as
    currencies became convertible. In order to
    convert currencies, countries settled their
    international balances in dollars, while
    U.S. dollars were fully convertible to gold.
    The exchange rate applied at the time was
    $35/ounce. Keeping the price of gold fixed
    and adjusting the supply of dollars was
    the responsibility of the United States.
    FAIL OF BRETTON
    WOODS AGREEMENT
    “THE UNITED STATES KEPT RUNNING
    DEFICITS TO FUND VARIOUS PROJECTS
    SO THE AMOUNT OF DOLLARS IN
    EXISTENCE KEEP INCREASING AND THE US
    GOLD RESERVE KEEP DECREASING”
    The Bretton Woods Agreement was dissolved
    between 1968 and 1973. An overvaluation of the
    U.S. dollar led to concerns over the exchange
    rates and their tie to the price of gold. President
    Richard Nixon called for a temporary suspension
    of the dollar’s convertibility. Countries were then
    free to choose any exchange agreement, except
    the price of gold. In 1973, foreign governments let
    currencies float, which put an end to the Bretton
    Woods system.

    Source:https://www.investopedia.com/terms/b/brettonwoodsagreement.asp
    HOW IS THE EXCHANGE
    RATE DETERMINED?
    Under the system of freely floating exchange rates,
    the value of all major currencies in terms of the
    peso, like any commodity or service being sold in
    the market, is determined by the forces of supply
    and demand. Under a fixed exchange rate
    system, a par value rate is set between the peso
    by the central bank. The par value may be
    adjusted from time to time.

    Source; http://www.bsp.gov.ph/downloads/Publications/FAQs/exchange.pdf

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