Smithsonian Agreement

1971

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July 13, 2026

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The Smithsonian Agreement, signed in December 1971, was an attempt to stabilize international currency exchange rates. Representatives from the Group of Ten nations met at the Smithsonian Institution and agreed to realign currencies, devaluing the U.S. dollar in relation to gold and appreciating other currencies against the dollar. This agreement represented a nearly 10 percent devaluation of the dollar against other major currencies.

However, the Smithsonian Agreement proved to be a short-term fix. By February 1973, the dollar was devalued again, and major economies began allowing their currencies to float freely. This marked the end of the established system of fixed exchange rates that had been in place since the Bretton Woods Conference after World War II.12

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international payment and exchange
The Smithsonian Agreement and after
On Dec. 17 and 18, 1971, representatives of the Group of Ten met at the Smithsonian Institution in Washington, D.C., and agreed on a realignment of currencies and a new set of pegged exchange rates. The dollar was devalued in terms…
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On Dec. 17 and 18, 1971, representatives of the Group of Ten met at the Smithsonian Institution in Washington, D.C., and agreed on a realignment of currencies and a new set of pegged exchange rates. The dollar was devalued in terms…
Read More