At the end of the Second World War the Bretton Woods Conference agreed to establish the U.S. dollar as the global vehicle currency and establish the value of the dollar to gold at $35 equal to one ounce of gold. Other currencies were pegged to the U.S. dollar within +/- 1% fluctuation. This was a fixed exchange rate. But, things changed. What changed and how have the international financial markets adapted? In 1947 the General Agreement on Tariff and Trade was established and reduced international trade tariffs considerably. What was the initial tariff reductions then and where are tariffs now? What was the reasoning behind fixed exchange rates and lower tariffs? Remember this was shortly after World War Two. At the end of the Second World War the Bretton Woods Conference agreed to establish the U.S. dollar as the global vehicle currency and establish the value of the dollar to gold at $35 equal to one ounce of gold. Other currencies were pegged to the U.S. dollar within +/- 1% fluctuation. This was a fixed exchange rate. But, things changed. What changed and how have the international financial markets adapted? In 1947 the General Agreement on Tariff and Trade was established and reduced international trade tariffs considerably. What was the initial tariff reductions then and where are tariffs now? What was the reasoning behind fixed exchange rates and lower tariffs? Remember this was shortly after World War Two