Foreign exchange - or Forex - trading as it is known today developed during the 1970s; however, the concept behind Forex trading has been around in one form or another for centuries.
The original concept of trading currencies developed in the Middle Ages, but it was not until the late stages of the second world war that the idea of a system using fixed exchange rates was introduced to the global economy.
Prior to this time, many governments had supported their currencies with convertibility into gold; however, following the abandonment of this system during the first world war, problems quickly arose when there were insufficient gold reserves to support the currencies.
As a result of the global economic crash which led up to the second world war, the Americans put forward what is known as the Bretton Woods agreement in 1944.
The allies - France, Britain and the US - agreed the accord, which was designed to stabilise world currency markets by reinstating the gold standard, fixing the US dollar to the commodity at a specified rate and fixing other global currencies to the US dollar.
Organisations such as the International Monetary Fund (IMF), the World Bank and General Agreement on Tariffs and Trade (GATT) were also established during this period.
Under the Bretton Woods agreement, countries were not allowed to devalue their currencies in order to gain a trade advantage but this system became unworkable as volumes of international trade increased substantially.
By the 1970s, it was agreed that the US dollar was no longer strong enough to be considered as the sole international currency.
The Bretton Woods agreement was abandoned in the early 1970s, paving the way for the modern foreign exchange system to develop.
This removed restrictions on capital flows in many countries, allowing worldwide currencies to be floated based on supply and demand.
Until 1995, Forex trading was solely the preserve of banks and other large multinational corporations.
However, the advent of internet-based technology has allowed the Forex market to open up, making it accessible to investors all over the world.
The introduction of the euro in 1998 and its subsequent adoption by many of Europe's largest economies further shaped the Forex market.
Since its inception in the 1970s, the business of Forex trading has grown substantially, with trillions of dollars traded each day in the global Forex marketplace.
MF Global Markets online Forex trading platform, previously known as GNI Touch, has been operating in global currency markets for more than 25 years.
MF Global Markets is a trading name of MF Global UK Ltd, a division of MF Global Holdings Ltd, a leading broker of exchange-listed futures and options in the world.
The company has more than 130,000 active accounts, with its client base ranging from financial institutions and hedge funds to professional traders and private or retail clients.
Operating in 13 countries and across more than 70 exchanges, MF Global can give you access to the largest and fastest-growing financial markets all over the world.
MF Global Markets is unique in that its business is diversified across products, trading markets, customers and regions, allowing for fast adaptation in the face of changing market conditions and client needs.
Our online Forex trading platform is a spot-based system that provides access to more than 40 currency pairs and offers a 40:1 (2.5%) margin.
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