The Bretton Woods Accords were signed between the world powers in July 1944 at Bretton Woods, New Hampshire, USA. It created the International Monetary Fund (IMF) to deal with external surpluses and deficits in its member states and the International Bank for Reconstruction and Development was created for post-reconstruction financing. The Bretton Woods Agreement of 1944 introduced a new global monetary system. It replaced the gold standard with the U.S. dollar as the global currency. It thus established America as a dominant power in the global economy. After the agreement was signed, America was the only country capable of printing dollars. The Bretton Woods countries have decided not to give the IMF the power of a global central bank. Instead, they agreed to contribute to a solid pool of national currencies and gold, which would be held by the IMF. Each member country of the Bretton Woods system then had the right to borrow as part of its dues, which it needed. The IMF was also responsible for implementing the Bretton Woods agreement. The World Bank was not (and is) not the central bank of the world.
At the time of the Bretton Woods agreement, the World Bank was created to lend to European countries devastated by the Second World War. The World Bank`s focus has shifted to lending to economic development projects in emerging countries. The Bretton Woods Agreement was launched in 1944 at a conference of all allied nations of the Second World War. It took place in Bretton Woods, New Hampshire. The Bretton Woods Agreement was launched in 1944 at a conference of all allied nations of the Second World War. It took place in Bretton Woods, New Hampshire. As part of the agreement, countries promised that their central banks would maintain fixed exchange rates between their currencies and the dollar. The agreement created the World Bank and the International Monetary Fund (IMF), U.S.-backed organizations, to oversee the new system.
As part of the agreement, countries promised that their central banks would maintain fixed exchange rates between their currencies and the dollar. If a country`s monetary value became too low against the dollar, the bank would buy its currency back on the foreign exchange markets. In some cases, people needed wheelbarrows full of money to buy a loaf of bread.