History of Forex

 

[column size=”1-2″ last=”0″ style=”1″] For thousands of years trading has been an important dynamic in the lives of people.

It’s said that the Babylonians were the first to have paper money. Ever since currency has been invented it has been traded in some way or another.

In the last century, for many years, the Forex (Foreign Exchange) rates were relatively stable or fixed. Rates fixed determined by their exchange worth in gold was established in 1944 when the dollar was selected to be the base of the Bretton Woods system. In the Bretton Woods system, currencies were rated in relation to the dollar value. The dollar was fixed to $35.00 per ounce of gold.

In the history of forex in the early 70’s the world economy transitioned into the current floating exchange rate system.

Fixed rates are no longer the center of the Foreign Exchange market. Supply and demand, which essentially controls most aspects of all world economy, is now what controls the Forex market. Though central banks and governments are involved in the Forex market there is no central head to the whole operation with this floating exchange rate system. [/column]

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