ABSTRACT
The inter-war years are remarkable in many ways, not least for the variety of exchange rate experiences. The lack of adequate international monetary cooperation and economic leadership in the inter-war years, and more especially in the economic crisis of the early 1930s, is a much-debated issue. In contrast to the virtually clean floating of currencies in the postwar years, currencies were extensively managed in the 1930s by new and more formal mechanisms. In contrast to the prewar period when the gold standard had reigned supreme in the major countries, the inter-war period saw several different regimes. Exchange rate stability within the gold bloc was purchased at a price. S. Howson maintains that domestic objectives were of paramount importance in setting the exchange rate target in the 1930s. Consequently, exchange rates continued to weaken and inflation proceeded apace. The experience of the exchange control countries was far from uniform despite their weak trade performance.
