The euro is the currency of the European monetary union and after the US Dollar of secondarymost important representatives in the world monetary system. It is controlled for other countries by the European central bank in Frankfurt/Main and is official currency in 12 of the 25 European Union states as well as in six. Besides there are five further countries and two currency areas with firm exchange rate to the euro.

The euro was introduced 1999 first only as Buchgeld. On 1 January 2002 euro-cash was in circulation brought for the first time. The euro replaced thereby the national currencies used in former times as currency. A euro is partitioned in 100 cent. Its past record high on the foreign exchange market in relation to the US Dollar reached the euro on 30 December 2004 with 1,3668 US Dollar, its record low with 0,8225 US Dollar on 26 October 2000.

History of the euro

The euro as political project

The origin of the euro as uniform currency of the European Union is to be looked for in the origins of the European union as well as in global restaurant history. On the one hand the material-economical integration with the customs union had far progressed already 1968, on the other hand one the collapse of the exchange rate system of Bretton Woods too strongly varying rates of exchange had led, which obstructed the trade in opinion of the policy. 1970 were concretized for the first time the idea of a European monetary union. In the Werner plan so mentioned the of Luxembourg prime minister Pierre Werner with experts compiled a European economic and monetary union (WWU) with a uniform currency. The project, a whose goal was it to realize the WWU until 1980 failed among other things because of the collapse of the Bretton Woods system. Instead 1972 the European rate of exchange group was created and 1979 the European monetary system (EMS). EMS should prevent all too strong fluctuations of the national currencies; for this purpose the ECU (European Currency unit) was created - an accounting unit, which one can already call forerunners of the euro. 1988 compiled the committee for the examination of the economic and monetary union under line of the chairman of the European commission, Jacques Delors, the Delors report in such a way specified. The Delors report plans the creation of the European economic and monetary union in three steps.

The euro and the German reunification

It does not seem to be coincidence that the European economic and monetary union were decided approximately at the same time as the German reunification. From official side, in particular of the German Federal Chancellor at that time Helmut Kohl, is disclaimed that because of the German reunification the German Mark was given up (old Federal Chancellor Helmut Schmidt stressed once in an interview that Kohl was intelligent "„enough, this impression to permit "“and that this facilitated the German agreement).

Undisputed it is however that it was very difficult for many Germans to give the German Marks up and a mehrheitliche agreement of the population would not have been in a popular vote to attain. Had turned around in particular in France the fears opposite a wiedererstarkten united Germany largely, so that in the opinion of from Germany a special step had to be set for some politicians for European integration.

Of a direct causal connection between European economic and monetary union and German reunification cannot be spoken however.

The euro accepts shape

The 1. Stage of the monetary union began on 1 July 1990 with the production of free capital traffic between the European Union states. On 1 January 1994 began the 2. Stage: European (EWI) as forerunners of the European central bank (EZB) was created and the budgetary situation of the member states was examined. In addition the European advice specified the name of the new currency in Madrid on 16 December 1995: "„Euro "“. Before this date also different names were in the discussion: Important candidates were thereby European Franconia, European crown and European gulden. Thereby continuity should be signaled and be strengthened by the use of an already well-known currency name the confidence of the population into the new currency. Beyond that some participant countries would maintained have known the past name of their currency. Some also with "„ECU "“, the name of the old currency of accounting of European Union. However all failed these suggestions because of the reservations of individual states, in particular Great Britain. As reaction thereupon by the German Minister of Finance Theodor Waigel as suggestion of the German delegation the name "„euro "“suggested.

At this name the fact is unfortunate that there is probably hardly a word, which is more differently expressed: Discussion on German [], on English [], on French and Netherlands [] and on Finnish and Italian []. Several Eastern European states energized beginning of 2006 to permit also different ways of writing of the European currency since the way of writing contradicts "„euro "“the grammatical rules of their languages. After some weeks calm air the discussion however off without result.

On 13 December 1996 the Ministers of Finance of the European Union agreed on the euro-stability pact, which should guarantee that all participating member states secure household discipline true and so the value of the currency. The third stage of the WWU stepped with the meeting of the European advice of the 1. to 3. May 1998 into force, on which according to fixed convergence criteria those were specified to eleven participating states of the economic and monetary union for the time being. On 19 June 2000 the European advice came to "„the view that Greece had achieved a high degree at lasting convergence and due to its, which fulfill necessary conditions for the introduction of the euro "“. Therefore Greece was taken up by 1 January 2001 to the economic and monetary union.

On 31 December 1998 the rates of exchange were specified by the advice chairman at that time of the European Union Ministers of Finance Dr. Rudolf Edlinger (Austria) between the euro and the individual currencies of the member states irrevocablly and the euro became thus on 1 January 1999 legal tender. Later, on 2 January, the European stock exchanges in Milan, Paris and Frankfurt/Main all securities in euro already noted one day. A further change in the temporal connection with the euro introduction was the change in the method of the price representation for foreign exchange. In Germany the Preisnotierung (1 USD = x) was the usual representational form up to the deadline. Since 1 January 1999 the value of foreign exchange in all participant countries in form of the quantity rate is represented (1 EUR = x USD). Furthermore 1999 transfers and debits in euro could be issued since 1 January (in Greece since 1 January 2001). Accounts and passbooks could be expressed euro and in the old national currency. Securities and shares were only acted in euro.

In Germany the euro was distributed in the context of the so-called Frontloading procedure starting from September 2001 at banks and trade. The trade should be included by the expenditure by euro and acceptance of DM into the conversion process. The expenditure to the final consumers began on 1 January 2002. Before, starting from 17 December 2001, already a first euro also "„starter kits "“, could be called purchased in German banks and savings banks.

During a certain transition period, which in each country individually either until at the end of of February 2002 persisted or to at the end of of June 2002, currencies in euro and the old national currency existed parallel in each participating country. Meanwhile the former national currencies are no more valid currencies. Most currencies can be exchanged however still with the respective national central banks against euro, in Germany at the branches of the German Federal Bank (formerly national central banks). In the context of special campaigns some German department stores or Discount chains still accept the German Mark as currencies.

In the twelve euro countries handling the earlier currencies is differently regulated. In Germany a legal, unlimited requirement on exchange of money free of charge of D-mark lights exists and - a conversion is only limited possible for coins in euro, in some other countries. Portuguese escudos and French and Belgian franc coins are not exchangeable any longer.

Despite the simple and free conversion mechanisms still D-mark coins were in the value of 3.72 billion euro (nearly 46 per cent of the from December 2000) in the circulation in May 2005. The value of the notes not exchanged yet in euro amounts to 3.94 billion euro. It acts in opinion of the German Federal Bank however to a large extent over lost itself gone or destroyed money.

Articles in category "Euro"

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