The historical ways of evaluating the currency value of a country by worth of Gold, finally came to an end much later after the Second World War. Even during the first World War, the value of Gold has been used to determine the value of foreign currency of a country. However, US dominated financial world had introduced Bretton Woods Agreement in 1944, where the Forex trading used to consider the dollar value of the currency of the concerned country as the key parameter.
The objective had been to fix the dollar value based on the rate of gold of the concerned country. The aim of establishing a stable market to get rid of any global financial crisis by prohibiting countries to devaluate their currencies, had been hindered by the phenomenal growth of Forex trading, which demands freedom from such control to take the ultimate advantage of the continuous influx from the foreign market. In fact the reign of gold could hardly face the challenges of modern economic boom all over the world. However the story of Frankenstein came into being, the US dollar itself got devaluated and that hit the final nail in the coffin to end the Bretton Woods Agreement era in 1971, allowing the new dawn of free floating real Foreign Exchange Market of today's world.
Nevertheless US dollars have always been playing a major role in Forex and reserves of US dollar serves as the prime factor in determining the country's wealth even today. The concept of globalization and the open market of outsourcing because of its proven advantages have made the core concept of foreign exchange more pertinent, where the foreign trade is hardly limited to big merchants only, rather it has now entered into the desktop computers of the professionals in their bedroom, where the concept of work from home has got its overwhelming popularity as a mode of extra income.
Outsourcing jobs from US & UK to the third world countries like India, China, Malayasia have ultimately helped to increase the foreign exchange worth of the country. Besides the core market of Forex trading, a huge amount of exchanges in currency has been going on every day. Though Forex is a free market for all, but it has been tested to be season proof, in spite of market deregulation or share market fluctuations or even political instability of any country in particular. Currencies move freely across the geographical boundaries and in spite of such a free floating, none of the major industrialized countries has faced any blow during the last three decades.
The Internet realm has given us the unique opportunity of online foreign currency trading, which uses mainly forex exchange software. As the very preliminary rule of foreign exchange never generates any scope for a physical bank or exchange, central in nature unlike the share market, various companies have emerged in the recent past to build up a virtual trading platform, where a lot of people can participate even without much knowledge of the subject. If beginner becomes the prime reason of worry, then anybody can take help of various forex news, which are available all over the Internet. The pictorial representation of hike and downfall of foreign currencies will always give you the comfort and smoothen your decision making process.
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