当代全球商务课件Chap010.ppt

chapter The International Monetary System Chapter 10: The International Monetary System INTRODUCTION The international monetary system refers to the institutional arrangements that countries adopt to govern exchange rates. When the foreign exchange market determines the relative value of a currency, a floating system exists When the value of a currency is fixed to a reference country and then the exchange rate between that currency and other currencies is determined by the reference currency exchange rate, a pegged exchange rate system exists Chapter 10: The International Monetary System A dirty float occurs when the value of a currency is determined by market forces, but with central bank intervention if it depreciates too rapidly against an important reference currency Countries that adopt a fixed exchange rate system fix their currencies against each other Prior to the introduction of the euro, some European Union countries operated with fixed exchange rates within the context of the European Monetary System (EMS) Chapter 10: The International Monetary System Classroom Performance System When the foreign exchange market determines the relative value of a currency, a ________ exchange rate system exists. Fixed Floating Pegged Market Chapter 10: The International Monetary System THE GOLD STANDARD The origin of the gold standard dates back to ancient times when gold coins were a medium of exchange, unit of account, and store of value. Mechanics of the Gold Standard The practice of pegging currencies to gold and guaranteeing convertibility is known as the gold standard Under the gold standard one U.S. dollar was defined as equivalent to 23.22 grains of fine (pure) gold The exchange rate between currencies was based on the gold par value (the amount of a currency needed to purchase one ounce of gold) Chapter 10: The International Monetary System The Strength of the Gold Standard The great strength of the gold standard w