This is an explainer and analysis, not a market forecast.

The deal that worked

On September 22, 1985, finance ministers from the United States, Japan, West Germany, France and the United Kingdom gathered at New York's Plaza Hotel and agreed to act together to weaken an overvalued US dollar, which had surged in the early 1980s and was hammering American exporters. It worked: the dollar fell sharply over the following two years — roughly 40% against the Japanese yen, as the Japan Times recounts. No currency summit before or since has moved markets so decisively.

Why the idea is back

The conditions rhyme with today: a strong dollar and wide US trade deficits. That has revived talk in some policy circles of a modern equivalent — sometimes dubbed a "Mar-a-Lago Accord" in Washington debates — to coordinate the dollar lower and help US manufacturing. (These are proposals and ideas, not policy.) But most economists think a sequel would fail. As the Atlantic Council put it, don't expect a "Plaza Accord 2.0" to reverse the dollar's strength.

Why it wouldn't work now

Four things have changed:

  • Currency markets have outgrown governments. In 1985, a few billion dollars of coordinated central-bank selling could shift the dollar. Today, foreign-exchange trading runs to roughly $7.5 trillion a day (per the Bank for International Settlements' latest survey) — a torrent that dwarfs what officials could realistically move. Markets, not summits, set the price.
  • China wouldn't cooperate. The 1985 deal worked because its members — especially Japan — were security allies with aligned interests. China, central to today's trade imbalances, is a strategic rival, not an ally, and has little incentive to deliberately strengthen its currency to suit Washington. Without Beijing, a grand bargain on global imbalances is hollow.
  • It clashes with the inflation fight. Deliberately weakening the dollar is, in effect, loosening policy — which would cut against the Federal Reserve's battle to bring inflation down under new Chair Kevin Warsh, and could rattle confidence in the dollar just as questions about its dominance are already live.
  • The real problem is fiscal. Economists note that today's imbalances stem largely from the US fiscal deficit and structural saving-and-spending patterns. Pushing the exchange rate down without addressing those doesn't fix trade — it just adds currency instability.

The dollar is under pressure anyway

Here's the irony: the dollar's grip is slipping on its own, without any accord. Its share of global reserves has eased from about 71% in 2000 to the high-50s% recently, by the IMF's reserve data, and central banks have been buying gold at a historic pace — around 1,037 tonnes in 2024, a third straight year above 1,000 tonnes, the World Gold Council reports — the de-dollarization trend Boursel has tracked. That drift is driven by structural forces — US debt, geopolitical mistrust, a fragmenting financial order — not by any coordinated campaign, and arguably can't be engineered by one either.

Why it matters

For markets and policymakers, the lesson is that the 1985 playbook doesn't fit 2026. Governments can still act unilaterally — through tariffs, bilateral deals or jawboning — but the dream of a smooth, coordinated currency realignment belongs to a smaller, more aligned world. The dollar's path will be set by the Fed's credibility, US fiscal policy and geopolitics — not by a handshake at a hotel. Boursel offers no view on where the dollar goes next; the takeaway is that the tool that worked in 1985 has been overtaken by the size and politics of modern finance.