The 1985 Plaza Accord coordinated a deliberate reduction in the U.S. dollar’s value.
Finance officials from the United States, Japan, West Germany, France, and the United Kingdom signed the agreement at New York’s Plaza Hotel on September 22, 1985. They judged that the dollar had become excessively strong and that coordinated intervention could encourage a more balanced international economy.
The agreement encouraged the participating countries to sell dollars and support other currencies. The dollar subsequently declined substantially against the Japanese yen and the Deutsche Mark. The change improved the competitiveness of some U.S. exports but also contributed to financial and economic adjustments in Japan.
The 1987 Louvre Accord later sought to stabilize exchange rates after officials became concerned that the dollar had fallen too far. Neither agreement was a general inflation treaty; both primarily addressed exchange-rate coordination.