The reason why national currencies are not 1: 1 is that they all represent a certain amount of value, which is the basis for determining exchange rates. In the past, countries used gold as a means of payment. Under the gold standard system, gold is the standard currency. The monetary units of two countries that implement the gold standard can determine the exchange rate between them according to their respective gold contents.

For example, when the gold coin standard system was implemented, Britain stipulated that the weight of 1 pound was 123.27447 grains, and the fineness was 22 karats, that is, the gold content was 1 13.005438+06 grains of pure gold; The United States stipulates that 1 USD has a weight of 25.8 grains and a purity of 900 thousandths, that is, pure gold with a gold content of 23.22 grains. According to the comparison of the gold content of the two currencies, the exchange rate fluctuates on the basis of 1 =4.8665 USD.

Under the paper money system, countries issue paper money as the representative of metal money. According to the past practice, the gold content of paper money is stipulated by the French exchange rate order, which is called gold parity. The comparison of gold parity is the decisive basis for the exchange rate between the two countries. Therefore, in countries with official exchange rates, the national monetary authorities (Ministry of Finance, Central Bank or Administration of Foreign Exchange) determine the exchange rates.