It was necessary to find a system to clean the outdated economic models with cycles of growth and recession so sudden and brief. In short , it was greater monetary stability that would turn sustainability of economic growth and a softening of the cycles of growth and decline .
Thus came the Bretton-Woods agreement held in the Mount Washington Hotel, which aimed to provide the nations monetary stability that would prevent currency speculation and capital flight between countries. Fixed exchange rate of all currencies against the dollar , and the dollar to turn to gold , ( 35$ per ounce of gold ) . Governments pledged to keep their currencies within a narrow margin against the dollar variation . In addition, central banks banned from each country the arbitrary devaluation of its currency to gain price competitiveness and increase exports to be the maximum tolerable devaluation of ten percent.But these conditions were not met since 1950 and above years , the massive reconstruction activity after the Second World War and the need for goods and services in a population with significant deficiencies , which made him a huge flow of capital to international level destabilized exchange rates agreed at Bretton-Woods. Finally , in 1971 they left the convention to be impossibility of compliance. The coins then began to fluctuate freely , based on the laws of supply and demand , calculated daily exchange rates . This greatly increased the volume of capital in circulation, and the speed and volatility of currency-exchange operations.
From the 80s , the introduction of new technologies began to promote the globalization of currency exchange basis, unifying the major markets of Europe (with the London market heading) , America and Asia time zones continuously , prompting a 24-hour exchange market .
Finally with the technological explosion of the 90´s and the spread of Internet all over the world in the new century, the foreign exchange market became global, continuous and accessible to all investors , becoming the largest market by volume capital involved daily. And this global market buying and selling of currencies is what is known as Forex ( Foreign Exchange Market Currencies ).
