The International Monetary Fund (IMF) was created to promote international monetary cooperation; to facilitate the expansion and balanced growth of international trade; to promote exchange stability; to assist in the establishment of a multilateral system of payments; to make its general resources temporarily available to its members experiencing balance of payments difficulties under adequate safeguards; and to shorten the duration and lessen the degree of lack of equilibrium in the international balances of payments of members.
On December 27, 1945, the IMF was established at the United Nations Monetary and Financial Conference, held at Bretton Woods, New Hampshire. At its birth, it was to oversee stability in international monetary affairs and to facilitate the expansion of world trade. Also created to aid these purposes was the International Bank for Reconstruction and Development (World Bank). Both were specialized agencies of the United Nations, and membership in the World Bank required countries to first be members of the IMF. The World Bank was given control over long-term financing for nations in need, while the IMF's responsibility was to monitor exchange rates, provide short-term financing for balance of payments adjustments, provide a forum for discussion about international monetary concerns, and give technical assistance to member countries.
The Fund's legal authority is based on an international treaty called the Articles of Agreement that came into force in December 1945. The first Article in the Agreement outlines the purposes of the Fund and, although the Articles have been amended three times in the course of the last 47 years prior to 1998, the first Article has never been altered.
The beginning of the IMF can be traced to March 1st 1947 where it first began its financial operations. Between 1947 and 1948 drawings were made on fund reserves by eleven countries and in subs