Development stage: 1. The gold standard era was a system based on gold, including gold coins, gold bullion and gold standard.
Before the first World War, the typical gold standard system prevailed, characterized by gold coins as the standard currency;
Free casting and melting;
Gold coins are freely convertible into bank notes;
Gold coins are freely imported and exported.
2, the paper currency era in the paper currency system, countries issued paper money as a representative of the metal currency, and refer to the practice of the past, in order to stipulate the gold content of paper money, called gold parity, gold parity contrast is the basis of the exchange rate of the two countries.
But paper money cannot be exchanged for gold, so the legal gold content of paper money is often meaningless.
3. Other theories Western exchange rate determination theories mainly include international lending theory, theory, exchange psychology theory, monetary analysis theory and financial assets theory. They respectively analyze the determinants of exchange rate from different perspectives.