Bretton Woods Agreement

The Bretton Woods Agreement of 1944 established the Bretton Woods system of monetary management, setting the rules for commercial and financial relations among 44 countries, including the United States, Canada, European countries and Australia. It was the first fully negotiated monetary order intended to govern relations among independent states, requiring countries to guarantee the convertibility of their currencies into United States dollars, with the dollar itself convertible into gold bullion for foreign governments and central banks. The agreement also established the International Monetary Fund to monitor exchange rates and lend reserve currencies to countries facing balance of payments deficits. The system it created remained in place until the Jamaica Accords of 1976.