Nixon imposes 10% import surcharge and closes gold window

President Nixon announced a package of emergency economic measures on August 15, 1971, including a 10% surcharge on all dutiable imports and the suspension of dollar convertibility to gold. Treasury Secretary John Connally designed the surcharge as a bargaining chip to force trading partners to revalue their currencies against the dollar. Nixon invoked authority under the Trading with the Enemy Act of 1917, which courts later upheld in United States v. Yoshida International. The surcharge was lifted four months later after the Smithsonian Agreement set new exchange rate parities.