Bretton Woods is an international agreement that was signed in 1944 to establish a monetary system in the world. It led to the formation of the International Monetary Fund (IMF) and the World Bank. The Bretton Woods Agreement set up a system of fixed exchange rates and allowed free cross-border capital flows, which enabled countries to borrow money from the IMF and World Bank to finance their economic development projects. The Bretton Woods Agreement also established the U.S. dollar as the world's reserve currency, which meant that countries could only buy and sell currencies in relation to the U.S. dollar. This system lasted until the early 1970s, when the U.S. withdrew its support for the gold standard and the Bretton Woods Agreement was abandoned. The World Bank and IMF remain as important international institutions today.