244. Editorial Note

On October 3, 1972, Hormats sent a memorandum to Kissinger apprising him that, in contrast to the roiled foreign exchange environment during the summer, the dollar had recently strengthened in European foreign exchange markets. During the previous week it had strengthened against all major European currencies and none of the European central banks had been required to purchase dollars to support their exchange rates. Hormats attributed this to an improving trade position and President Nixon’s and Shultz’ positive approaches at the IMF-IBRD meetings. (National Archives, Nixon Presidential Materials, NSC Files, Agency Files, Box 306, IBRD/IMF)

As 1972 ended, the newly established C-20 and its Deputies Committee began its work on international monetary reform, but the pace was slow. The first Ministerial on September 28 (see Document 237) was the only Ministerial during 1972. A second Deputies meeting was held November 27-29. The Embassy in London reported that during an EC Monetary Committee meeting on November 21 there was a constructive exchange of views on monetary reform. The Embassy noted there was scope for fruitful analysis of reserve gains and losses at the forthcoming Deputies meeting, but U.S. insistence on rigid, automatic criteria (for exchange rate adjustments) would not be acceptable. (Telegram 11273 from London, November 22; National Archives, RG 59, Central Files 1970-73, FN 10)