Below is a brief summary of why global economies were part of the Bretton Woods system, how the system worked, why it failed, and what impact the agreement had on the development of the international monetary system. Modern economists can draw a perspective and insight from the discovery of their profession`s past. The Bretton Woods Agreement of 1944 introduced a new global monetary system. It replaced the gold standard with the U.S. dollar as the global currency. It thus established America as a dominant power in the global economy. After the agreement was signed, America was the only country with the ability to print dollars. As part of the agreement, countries promised that their central banks would maintain fixed exchange rates between their currencies and the dollar. If a country`s monetary value became too low against the dollar, the bank would buy its currency back on the foreign exchange markets.
, experts learn about the impact of international agreements such as Bretton Woods, with the institutions that created them. Developing a strong international financial strategy means anticipating the impact of central bank announcements and actions, managed in the same way by national governments and international bodies. But on a larger scale, the agreement brought together 44 nations from around the world, who brought them together to solve a growing global financial crisis. It has helped strengthen the global economy as a whole and maximize international trade benefits. There was broad consensus among powerful nations that the lack of exchange rate coordination during the interwar period had exacerbated political tensions. This facilitated the decisions of the Bretton Woods conference. In addition, all the Bretton Woods governments agreed that the monetary chaos of the interwar period had brought some valuable lessons. Roosevelt and Henry Morgenthau insisted that the Big Four (United States, Great Britain, the Soviet Union and China) participate in the Bretton Woods Conference in 1944, but their objective was thwarted when the Soviet Union did not join the IMF.
In the past, the reasons why the Soviet Union decided not to sign the articles until December 1945 have been the subject of speculation. But since the publication of the Soviet archives, it is now clear that the Soviet calculation was based on the behaviour of the parties who had actually expressed their agreement with the Bretton Woods agreements. [Citation required] The long debates on ratification that have taken place in both the United Kingdom and the United States.