Smithsonian Agreement

Updated: Aug 20, 2021

An agreement concluded in December 1971 between the ‘Group of Ten’ of the International Monetary Fund at the Smithsonian Institute, Washington. Under the agreement, the major currencies were restored to fixed parities but with a wider margin, ± 2·25 per cent of permitted fluctuation around their par values. The dollar was effectively devalued by about 8 per cent and the dollar price of gold increased to $38 per oz. Sterling was set at $2·6057

Reference: The Penguin Dictionary of Economics, 3rd edt.

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James Knight
Editor of Education
James is the Editor of Education for Invezz, where he covers topics from across the financial world, from the stock market, to cryptocurrency, to macroeconomic markets.... read more.