History of the Forex market

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History of the Forex market

In 1944, in Bretton woods (new Hampshire), there was a meeting of representatives of those countries whose currencies at that time occupied the largest share in international settlements. After world war II, the United States had the strongest economy compared to the rest of the developed countries, its gold reserve was about 3/4 of the reserve of all market economies in the world (as of 1948). Therefore, it was decided to use the us dollar on a par with gold as the reserve currency of the world. Thus, the Bretton woods monetary system was created, on the basis of which the nominal value of the currencies of the participating countries of the system was set in US dollars or gold. The United States was obliged to exchange gold from its reserves for the available dollars of the countries participating in the currency system at their request. The purpose of the new system was to restore the world economy after the war and create an international monetary system that would be able to cope with the difficulties of the balance of payments of European countries.

During the period from the late 50s and early 60s, the US increasingly had a negative balance of payments, the number of dollars in the countries participating in the Bretton woods monetary system grew more and more, and at the same time, the us gold reserves were melting at a record pace. The demand for gold from the Central banks of other countries, which the US was obliged to meet in accordance with the concluded Bretton Woods agreement, increased significantly. The sale of gold based on a fixed price of $ 35 per ounce steadily undermined the us gold reserve. And even the established restrictions on the exchange of dollars for gold did not reduce the approaching collapse of the US economy.

In 1971, US President Richard Nixon announced the abolition of the Bretton woods system and the gold standard.

The Bretton woods system was replaced by the Jamaican monetary system, the fundamental principles of which were laid down in March 1971 on the island of Jamaica with the participation of 20 most developed countries. In 1976, a new currency system was officially approved in the city of Kingston, Jamaica, which legalized free exchange rate fluctuations. If exchange rates were stable under the gold standard, then after the adoption of the Jamaican system, fluctuations in exchange rates became inevitable due to the floating exchange rate of gold. All this created the conditions for the emergence of a relatively new field of activity-currency trading, in which the exchange rate began to depend not only on the gold equivalent of a particular currency, but also on market demand or supply for it.

On January 1, 2002, the Euro was introduced into cash circulation, which significantly affected the foreign exchange market.

Trading on the Forex market is significantly different from trading on other markets, which is associated with large credit opportunities and high risks. But for those who decide to take this risk, it is possible to get a decent profit from successful transactions.

Due to the financial availability of trading on the Forex market today, not only banks can perform operations with currency, but also individuals who do not have multi-million-dollar capitals. The introduction of innovative technologies and trading in electronic networks provides an opportunity for traders to earn significant income. Their share today accounts for more than 10% of the turnover of the Forex market.

Posted: 09-05-20 11:25 by dogava

The market began to form in the 70s of the last century. The rejection by all world powers of the gold standard in 1976 served as the basis for the creation of Forex. Since that time, countries have switched to the Jamaican system. Exchange rates began to depend on market relations and not established by the state as it was before. Such a development of events contributed to the normal functioning of the world economy. The exchange of capital between different countries became fully possible. Today, the daily and increasing over time turnover of the international trading platform is from 5 to 7 trillion dollars.

Posted: 11-05-20 13:40 by Kupezman

Such volumes, of course, can not but kick. If you only imagine how much money is being used and how much more people are making a profit. Therefore, it’s worth trading, but after a certain study. Five years is not enough for many people.

Kupezman wrote:

The market began to form in the 70s of the last century. The rejection by all world powers of the gold standard in 1976 served as the basis for the creation of Forex. Since that time, countries have switched to the Jamaican system. Exchange rates began to depend on market relations and not established by the state as it was before. Such a development of events contributed to the normal functioning of the world economy. The exchange of capital between different countries became fully possible. Today, the daily and increasing over time turnover of the international trading platform is from 5 to 7 trillion dollars.

Posted: 11-05-20 14:28 by bersifa

Forex trading strategies are many and, of course, each has its own advantages and disadvantages. One of the most popular at the same time is swing trading, which is often called the fundamental approach to Forex, and its peculiarity is that transactions are concluded not for one and often not even for 2 days, but for a longer time. At such a time, the study of fundamental data plays a key role, since the influence of such factors on the rates of financial assets occurs within a few days.

Posted: 11-05-20 14:51 by jojo90

Many customers do not ask support questions that could help solve difficult situations. In this way, while a trader is learning to trade, you can learn a lot from support staff. You will also receive new information about the work of the company itself, which is also important. In particular, if the customer does not know how quickly and clearly the support service responds to the request, he cannot calculate how long it will take to solve the problem. It is also important not to find out this nuance at the last moment when working with a broker.

Posted: 11-05-20 17:15 by Kloaka

The history of the Forex market is usually counted from the seventies of the last century when the formation of exchange rates finally abandoned the gold standard. The beginning of this process can be considered August 15, 1971 - on this day, US President Richard Nixon announced that he was abolishing the free conversion of the dollar into gold. The US rejection of the gold standard also meant the rejection of the Bretton Woods Agreements of 1944 when a decision was made at an international conference according to which the dollar was provided with gold and all other currencies were provided with the dollar. According to new agreements, the value of currencies began to be formed on the basis of supply and demand. The final coordination of important points took place in 1976 at a meeting of ministers of countries belonging to the IMF. And in 1978, the IMF at the official level allowed the refusal to peg national currencies to gold. Since that time, exchange rates have become floating. This system is still in effect.  Despite the fact that the central banks of the states maintain the value of their currencies within certain boundaries while preventing significant changes, exchange rates still fluctuate within certain limits, which allows traders to earn money on their change. It should be noted that the bulk of Forex   https://trade-leader.com/    participants are large private and state-owned banks, they do not exchange currencies for speculative purposes, but to maintain the exchange rate within certain boundaries and maintain the national economy. In the latter case, we are talking about providing needs in the currency of enterprises conducting international activities.

Posted: 12-05-20 16:10 by Rumtin

Thanks for the useful information.

Posted: 27-05-20 22:53 by Dahilla