the presentation takes you through the five distinct stages of the evolution of world monetary system

1. Evolution of international
monetary system
By
A.Rachana

2. Evolutionof IMS
1875
•Bimetallism
1875-1914
•Classical gold standard
1915-1944
•Interwar period
1945-1972
•Bretton woods system
1973
•Flexible exchange rate system s

3. BIMETALISM
• gold and silver coins -used as international
means of payment
• exchange rate among currencies were
determined either by gold or silver content
• Defects
– Unstable, biconstructive
– massive changes in money supply

4. GOLD STANDARD
• Exchange rate b/w countries will be
determined by their gold content.
• Suppose
– 1 ounce of gold= 6 pounds
– 1 ounce of gold= 12 francs
– It means 1 pound= 2 francs. will be the exchange
rate.

5. Interwar Period 1915-1944
• World war 1 ended the gold standard in 1914,
• Restrictions on gold export
– Britain, France, Germany and Russia
– Germany, Austria, Hunary and Russia- Hyper
inflation
• US replaced Great Britain as dominant
financial power
• Fueled up by the great depression

6. Breton woods system 1945- 1972
• Monetary and Financial Conference held in
Breton Woods, New Hampshire, from July 1 to
July 22, 1944.
• 730 delegates from the 44 Allied nations
attended the conference
• US held 2/3rds of world gold reserves
• Major outcomes
IMF
IBRD
Rupees,yen,etc
WORLD
CURRENCIES
quantity
GOLD

7. Flexible exchange rate system since
1973
• The breton woods system collapsed on 15th
august 1971
• Fixed exchange rate system was formalized in
January 1976 when IMF members met in
Jamaica and agreed to the rules of the
international monetary system that are in
place today.