Rus Articles Journal

History of the market Forex of

served as the Beginning of the present stage of formation of the Forex market crisis of economy 30 - x years. The inflation which burst around the world after the end of World War I made impossible deduction of the fixed price of gold. In 20 - x years there were shy attempts of recovery of the gold standard in a cut form which underwent full crash. World financial crisis of 1929 - 1933 led to destruction torgovo - economic relations and forced the governments of the leading world powers to refuse a binding of rate of national currency to price of gold. Those years world reserve currency was the British pound sterling which could be exchanged at the fixed price for gold, and London was world financial center.

When World War II approached end, the USA, Great Britain and France became initiators Bretton - Vudsky conference (July, 1944). By its results the rigid binding of exchange rates in relation to US dollar which was in turn rigidly attached to the price of the same gold was established. Thus, the priority was displaced towards the United States as this country at that time became the most developed economic power, less others having suffered in the years of war. Exchange rates could deviate the established parities to dollar no more than for 1%. Balances of payments of the countries were automatically leveled due to the change of currency reserves happening owing to change of the income and the prices.

Some time this system successfully worked, however, being the world economy adapted for acceleration of post-war restoration, showed the weakness during rapid growth. Growth rates of economy in various countries more and more differed, leading to strengthening of universal growth rates of the prices. Stimulation of consumption in the USA led to considerable strengthening of rates of inflation, and the gold price in the market exceeded an official fixed rate. In due time the president of France Charles de Gaulle for replenishment of national gold reserves, despite openly unfriendly nature of similar actions successfully used it.

Similar non-market regulation could not be supported throughout the long period of time, threatening economy with more large-scale consequences. In August, 1971 the U.S. President Richard Nixon deprived national currency of a binding to gold, and later, in December of the same year made the decision to carry out devaluation of national currency. These steps served as the beginning of a way of refusal of a rigid binding of exchange rates to gold and transition to floating system of exchange rates. Transition to floating exchange rates was formalized in Jamaica to Kingston in 1976. Since then considerably the role of commercial banks as mechanism by means of which the international currency transactions are carried out amplifies.

The Jamaican currency system does not assume a rigid binding of currencies to gold, as well as establishment of parities between exchange rates of the different countries. Nevertheless, the updated charter of the IMF allows his members at desire to use a course of this or that currency, either a basket, or SDR as a reference point for establishment of rate of national currency. The European countries for creation of the European Currency System used it. This system in more soft option Bretton - Vudsky system where boundary and central points of rate fluctuations were determined by the relation to each other was similarity. At approach of exchange rates to border of the specified corridor both countries were obliged to carry out interventions. The currency basket which conventional unit was called ECU was formed of exchange rates of member countries (European Currency Unit, ECU). By 1985 the ECU becomes the physical tool: jars are opened by deposits in this unit, the traveler`s checks nominated in ECU are issued. In 1999 with ECU it was replaced with Euro which in 2002 completely replaced local currencies in 11 European countries, having formed thereby the eurozone. Since January, 2008 Euro - official currency in 15 countries of Europe.

The Forex market is characterized in the largest volumes of the held auction now (more than one trillion dollars a day). Thanks to association in a global telecommunication network, the auction on Forex happen round the clock to gradual movement of cents of trade from the Pacific Ocean to Asia, Europe, and then and to America. Huge trading volumes in combination with the round-the-clock functioning do Forex by the most liquid market that leads to the lowest cost of the carried-out transactions. Also the highest liquidity allows the broker to provide to clients the greatest leverage, providing a possibility of receiving high profits at rather small capital.