Poland, the international monetary system and the Bank of England, 1921–1939

William Allen

No 328, NBP Working Papers from Narodowy Bank Polski

Abstract: The paper uses archive material, mainly from the Bank of England, to give an account of the relationship between Poland and the international monetary system between 1921 and 1939, as seen from the United Kingdom. It describes the 1923 – 1924 Hilton Young mission of ‘money doctors’ and its role in the establishment of the Bank Polski and the introduction of the złoty in 1924; the abandonment of the złoty’s gold parity in 1925; the tortuous negotiations leading to the stabilisation programme and stabilisation loan of 1927, including the Bank of England’s unsuccessful efforts to induce Poland to accept the oversight of the League of Nations; Poland’s gold purchases after the stabilisation loan; the process of deflation during the Great Depression; the abortive discussions in 1934 – 1936 of the possibility of Danzig, Germany and Poland pegging their exchange rates to sterling; the imposition of exchange restrictions in 1936; debt default in 1937; and the approach of war. It also provides information about the management of Poland’s gold and foreign exchange reserves. The narrative makes clear that it is impossible to understand Poland’s international financial affairs without reference to the international political tensions of the period.

Keywords: Poland; United Kingdom; international monetary system; Bank Polski; Bank of England; złoty; gold exchange standard; foreign exchange; sterling bloc; exchange restrictions; default; Genoa conference; money doctors; stabilisation; League of Nations; Polish Corridor; Federal Reserve; Bank of France; Reichsbank; J.P. Morgan; Council of Foreign Bondholders; Danzig; Germany; France; Norman; Hilton Young; Grabski; Karpiński; Młynarski; Barański; Koc; Strong; Harrison; Moreau; Niemeyer; Siepmann; Schacht; Kemmerer. (search for similar items in EconPapers)
JEL-codes: E42 E58 F33 F34 F52 N34 N44 (search for similar items in EconPapers)
Pages: 232
Date: 2020
New Economics Papers: this item is included in nep-cba, nep-his, nep-hpe, nep-mac and nep-mon
Note: This paper was inspired by discussions with Zbigniew Polański. I am extremely grateful to him, and to Cecylia Leszczyńska, for their encouragement and valuable comments on earlier versions of the paper, for collecting data and making them available to me, and for reviewing the data in the paper. I am also extremely grateful to Mikołaj Szadkowski for help with editing the paper, and to Mike Anson, Margherita Orlando and the other staff of the Bank of England archives for their expert help. All errors of fact and interpretation are my own. Further comments would be welcome.
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Persistent link: https://EconPapers.repec.org/RePEc:nbp:nbpmis:328

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