To avoid frequent rounds of devaluation by nations and retaliatory action of devaluation by competing nations, various international organisations like the International Monetary Fund (IMF) have been established to help coordinate foreign exchange policies and trade among different countries. You can read about the Balance of Payment Crisis, 1991 – Causes and Measures to Control it in the given link.
To avoid gaining unfair competitive advantage by nations, through devaluation of their currencies, Article IV of the IMF charter gives information for prevention of exchange rates manipulation.
- Forex Reserves – Meaning, Importance, Advantages (Notes for UPSC IAS exam)
- New Economic Policy of 1991 – Objectives, Liberalisation, Privatisation, Globalisation