Exorbitant global imbalances

The Bretton Woods system in the aftermath of the Second World War provided the world economies with a monetary framework to replace the Gold Standard that prevailed in the preceding period. The system to rebuild war-torn economies worked fine but it could not meed the needs of the growing world trade and economy. Post Bretton Woods world evolved into a global reserve system adopting the currency of the dominant power at this time, the United States, the dollar.