Submitted by: Submitted by wcofclass19
Views: 10
Words: 972
Pages: 4
Category: Business and Industry
Date Submitted: 10/20/2015 08:16 AM
THE EURO
Kitane, Mapoy,
Oblepias
HISTORY OF EURO
● 1992 - The euro was established by the provisions in the
Maastricht Treaty.
● 1995, Aug 4 - Esperantist Germain Pirlot sent a letter to then
President of the European Commission, Jacques Santer to
name the currency as “Euro”
● 1995, Dec 16 - The name "Euro" was officially adopted in
Madrid
● 1998, May 2 - to establish the fixed conversion rate for each
national currency, they used the bilateral rates of the
Exchange Rate Mechanism(ERM). In order not to modify the
external value of the European Currency Unit (ECU).
HISTORY OF EURO
● 1999, Jan 1 - introduced in non-physical form (traveller's
cheques, electronic transfers, banking, etc.)
● 2002, Jan 1 - Euro notes and coins became legal tender
● 2002, July 1 - The German Mark, French Franc, Italian Lira,
and other local currencies ceased to exist
■
the European Central Bank started implementing
monetary policy of the countries using Euro as
currency.
MEMBER COUNTRIES
●
●
●
●
●
●
●
●
●
Austria
Belgium
Cyprus
Estonia
Finland
France
Germany
Greece
Ireland
●
●
●
●
●
●
●
●
●
Italy
Latvia
Luxembourg
Malta
The Netherlands
Portugal
Slovakia
Slovenia
Spain
HOW DOES IT WORK?
Countries who wished to participate in the euro had to pass some economic tests referred to as convergence
criteria:
●
The country's annual government budget deficit cannot exceed 3 percent of gross domestic product
●
The total outstanding government debt cannot exceed 60 percent of GDP.
●
Country's rate of inflation must be within 1.5 percent of the three best performing EU countries.
○
●
(to push down inflation rates and encourage more stable prices)
The average nominal long-term interest rate must be within 2 percent of the average rate in the three
countries with the lowest inflation rates.
○
(Interest rates are measured on the basis of long-term government bonds and/or comparable...