Euro Crisis

What is Euro?
The euro () is the currency used by the Institutions of the European Union It is the official currency of the euro zone, which consists of 17 of the 28 member states of the European Union in the Maastricht Treaty in 1992. 17 countries who adopted the EURO: Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece,Irelan d, Italy, Luxembourg, Malta, the Netherlands, Portugal, Slovakia, Slovenia, and Spain Officially adopted on 16 December 1995 The euro was introduced to world financial markets as an accounting currency on 1 January 1999 It is the second largest reserve currency and the second most traded currency in the world after the United States dollar. Managed by the ECB (European Central Bank) ECB has sole authority to set monetary policy

Eligibility of Euro
Price stability Sound public finances Sustainable public finances Durability of convergence Exchange rate stability

 The Pound was already globally used in trade and finance, which benefited the British economy These were already among the most economically advanced in the EU Worried about no longer being able to control their currency

Why UK along with Sweden & Denmark declined the offer for adopting the EURO currency

Merits & Demerits of Euro

Having a single currency for most of the EU would encourage Europeans do business with companies across Europe

Why did EURO crisis occur

PIIGS
Portugal, Ireland, Italy, Greece and Spain

Spillover Effects of the EURO crisis

Remedial Measures taken by ECB

Role of Germany and France

Current Situation of EURO ZONE