History of Forex :

For beginners of the foreign exchange market who will not know its history, here in a few dates, the evolution over the years of what is called today, the forex.

Gold Standard and Bretton Woods Agreement
Exchange systems have always existed, but the contemporary structure of forex rests mainly on two of them: the gold standard of 1875 and the Bretton Woods agreement of 1944.

The first great revolution for the international currency market was the introduction of the gold standard in 1875. This exchange system was set up in order to standardize the means of currency conversion between the different countries. Henceforth, the parities are fixed according to the gold and the countries are endowed in gold reserve. The gold standard has its limits at the time of the First World War, when the arms race leads to deep gold deficiencies.

The Bretton Woods Agreement came into force in July 1944. It endorsed the US dollar as the base currency of currency exchange, which means that world currencies are now estimated against the dollar. The American currency remains convertible into gold. The fixed rate was set at $ 35 per ounce of gold. Twenty-five years later, the system was abandoned because of, among other things, the instability of exchange following post-war reconstruction.

In 1971, and it is a new great revolution, end of the convertibility in gold for the currencies and place to the floating regimes. This is a feature that forex still has today. The market becomes freer and the exchange rate will now be determined by the supply and demand on the forex. As a result, exchange rates have become more volatile.

The 1980s marked the advent of electronics and computing. From now on, it is possible to speculate on the forex over a longer time range and even remotely. Thanks to these innovative technologies, the foreign exchange market has also become much more democratic, opening up, in particular, to individuals.

Today, forex has become an extremely popular market on which to invest 24/7. The actors have grown rich and we can also meet large financial institutions as well as private individuals who exercise, in parallel, a salaried activity.

With the steady increase in global currency trading, the forex still has good days ahead! The concept of supply and demand gives an advantage to investors, who are increasingly more likely to join it.