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The international monetary and financial system: a fork in the road

Type
Speech
Subtype
BIS speech
Date delivered
29 June 2025
Andrew Crockett Memorial Lecture on the occasion of the Bank's Annual General Meeting, Basel, 29 June 2025.

A US-centric, dollar-based international monetary and financial system (IMFS) was inevitable in the immediate postwar decades considering prevailing economic conditions and the institutional arrangements made at Bretton Woods. But while some predicted that the end of the Bretton Woods system in 1973 would bring a more symmetric IMFS, the United States has remained central until now, and the dollar still reigns supreme. The US administration in power since January 2025 is taking a different fork in the road, basing its international policies on the premise that current global trade, financial and geopolitical arrangements have unfairly disadvantaged America. Coupled with domestic institutional erosion within the United States, that approach, if pursued without compromise, would recast the IMFS by fragmenting financial markets and diminishing the dollar's central role.

The views expressed here are my own and not necessarily those of the BIS or its member institutions.

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