U.S. Gained From Ending Gold Standard in 1971: Chart of the Day
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The U.S. “benefited immeasurably” from dropping the gold standard four decades ago because the dollar became the world’s reserve currency, allowing borrowing costs to fall, Societe Generale SA said.
The CHART OF THE DAY shows how the Dollar Index, a measure against six counterparts, declined as bullion advanced since President Richard Nixon abandoned the gold standard in 1971. The index is trading about 4.6 percent above the record low reached in 2008, while gold hit an all-time high on Aug. 11 this year. It would have to rise another 30 percent to match the peak of $850 an ounce reached in 1980 on an inflation-adjusted basis.