Forex market emerged relatively recently, the reason for its occurrence is the use of the international finance system of floating exchange rates, but it was not always so. First, there was a system of fixed exchange rates.
The system of fixed exchange rates was established in July 1994. Then, in Bretton Woods, located in the U.S., 44 states have created the International Monetary Fund (IMF). The main objectives of this international organization began monitoring the balance of payments of countries participating in the fund and control over the exchange rates of their currencies. The agreement was based on establishing a system of fixed exchange rates of monetary units of all the countries in the IMF. Binding was carried to the gold course. One ounce of gold was equal to 35 U.S. dollars. All currencies of other countries, at a fixed rate tied to the dollar. For example, one British pound sterling could be bought for $ 4.80.
Memorandum of Association allow the IMF member countries to adjust the value of national currencies in the extreme, the most severe cases. And the countries of this. For example, the British pound devalued twice. For the first time in 1947, while its price set at $ 2.80, the second time - in 1967 the pound was the price of $ 2.40.
The system of fixed exchange rate regime has worked well in the 50s and early 60s, but by the early 70s it has ceased to hold all, because in 1971 it was abandoned. The international community has shifted to the use of floating exchange rates, and regulated system of exchange rates. Value of the currency began to be tied to the economic state of the country, it is this group of factors was to determine the market price of the currency. This led to the fact that the money was used as the object of investment, along with stocks and bonds, which in turn has a direct prerequisite for the appearance of the Forex market.
It remains only to connect willing to sell currencies of the country with those who want to buy them, and originated the currency market Forex.
Now it is important not only in that the investor invests a significant role was playing the currency of investment. For example, an investor bought in the Forex market rising in price by 30% per year instead of the Swiss franc shares of American companies, which fell by 20%. Thus, the investor is not only found a good investment object, but also got rid of the weak currency.
The system of fixed exchange rates was established in July 1994. Then, in Bretton Woods, located in the U.S., 44 states have created the International Monetary Fund (IMF). The main objectives of this international organization began monitoring the balance of payments of countries participating in the fund and control over the exchange rates of their currencies. The agreement was based on establishing a system of fixed exchange rates of monetary units of all the countries in the IMF. Binding was carried to the gold course. One ounce of gold was equal to 35 U.S. dollars. All currencies of other countries, at a fixed rate tied to the dollar. For example, one British pound sterling could be bought for $ 4.80.
Memorandum of Association allow the IMF member countries to adjust the value of national currencies in the extreme, the most severe cases. And the countries of this. For example, the British pound devalued twice. For the first time in 1947, while its price set at $ 2.80, the second time - in 1967 the pound was the price of $ 2.40.
The system of fixed exchange rate regime has worked well in the 50s and early 60s, but by the early 70s it has ceased to hold all, because in 1971 it was abandoned. The international community has shifted to the use of floating exchange rates, and regulated system of exchange rates. Value of the currency began to be tied to the economic state of the country, it is this group of factors was to determine the market price of the currency. This led to the fact that the money was used as the object of investment, along with stocks and bonds, which in turn has a direct prerequisite for the appearance of the Forex market.
It remains only to connect willing to sell currencies of the country with those who want to buy them, and originated the currency market Forex.
Now it is important not only in that the investor invests a significant role was playing the currency of investment. For example, an investor bought in the Forex market rising in price by 30% per year instead of the Swiss franc shares of American companies, which fell by 20%. Thus, the investor is not only found a good investment object, but also got rid of the weak currency.