After the First World War, the nations of Europe faced exchange-rate volatility, high national debts, and inflationary pressures. In response, many sought to stabilize the economies through extensive fiscal and monetary reforms. One of the key figures in the reconstruction effort was Henry Strakosch. As the Bank’s informal adviser, he was responsible for devising restructuring plans across Central Europe and the British Empire. Leveraging his connections at the League of Nations, the Bank of England, and the City of London, Strakosch led negotiations that resulted in the establishment of both the Austrian National Bank and the South African Reserve Bank. His work exemplified the institutionalization of economic orthodoxy in circles of influence and heralded the rise of the international financial expert. More broadly, Strakosch’s interventions contributed to the state-building process in the interwar years, as new nations drew on expert knowledge to establish their political legitimacy.

This chapter challenges the conventional chronology of the interwar era that distinguishes the conservative 1920s, when policy makers were preoccupied with the restoration of the pre-First World War liberal economic order, and the revolutionary 1930s, when they reacted to the global economic and financial crisis by pursuing isolationism, state interventionism, and trade blocs. Taking the example of Hungary’s monetary management in the 1920s, it shows that there was more continuity between the two decades than is usually recognized. Due to the dislocations arising in the wake of the war and subsequent peace arrangements, the fragmentation of empires into small ethnonationalist states, and revolutionary and counterrevolutionary political and social upheavals, institutional and policy adjustments in the direction of what was to become mainstream in the 1930s were already budding in the 1920s. The chapter provides empirical evidence of this sneaking nationalization in Hungary’s monetary management, manifest in a combination of adherence to the rules of the gold standard game, on the one hand, and capital-flow neutralization, on the other, depending on what was appropriate to stimulate or sustain domestic economic activity.