From 1971. So far, we have the same currency system. In many countries prevailed floating exchange rate system, which is composed not only of the U.S. dollar, but also of other currencies. In 1978. IMF Statute of the correction, allowed the Member States free to set their own exchange rates by another currency or basket of currencies is still not to fix it. If the terms of a basket of currencies, the most popular is the ECU - European Currency Unit, which includes the European currency and the value of which changes daily, depending on how it is composed exchange rates are changing. In 1979 the European Economic Community (now EU - European Union) countries to the establishment of the European Monetary System, was the adoption of common principles for determining the exchange rate applied, ie in each currency should be "... the central rate, expressed in ecus, while in the foreign exchange market rate can deviate from the so-called central rate within certain limits". Floating exchange rate market is dominated by high uncertainty and volatility in international currency in circulation. Here's devaluation in 1992 was weaker currency at the time - the Italian lira and Spanish pesetas, and in 1993 was the beginning of the monetary system crisis, the European Union, the government decided to extend until the narrow market exchange rate fluctuation range - from 2.2 to 6% to 15% up or down from the central rate.
International trade, in contrast to the domestic market, the settlement between the parties using different currencies. For example. U.S. manufacturer to purchase raw materials in Great Britain, to pay for them in your currency - dollars, but in a country uses a different currency, so that they can receive payments in pounds sterling. In this case, the buyer originally from the United States will ask the foreign exchange market, which will be able to change dollars into pounds, and only then be able to purchase the necessary raw materials. "Foreign exchange market is an established major centers such as London and New York" (4, 291). In these markets, one of the country the money is changed into a different state money by the time the current exchange rates.
See also: Trend
, day trading strategies