As a result of its balance of payments deficit in the 1960's and the effect on its currency:
A)the United States was able to sell all of its gold holdings at the established price of USD 35 per ounce.
B)the United States was no longer able to sell its gold holdings at the established price of USD 35 per ounce.
C)the USD ceased to be the key international currency that it was under the Bretton Woods Agreement.
D)the IMF had to make temporary loans to the United States.

Question

Quizplus · Accepted Answer

Due to the balance of payments deficit in the 1960s, the United States was no longer able to sell its gold holdings at the established price of USD 35 per ounce. This led to the collapse of the Bretton Woods system of fixed exchange rates, which had pegged the value of other currencies to the USD. This resulted in the USD losing its status as the key international currency. The IMF had to make temporary loans to the United States to help it manage the situation.

As a Result of Its Balance of Payments Deficit in the 1960's