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Effect of Euro on International Economy The Effect of the Euro on the International Economy The Euro is the common name for the bank notes and coins used by over
global oil consumption via OPEC provides a healthy subsidy to the U.S. economy. Hence, the Europeans created the euro to compete with the dollar as an alternative
the decreased OPEC demand for the dollar have a potential, tremendously negative effect on the value of the dollar. The Euro zone's largest economy, Germany, slipped
EMU did not reach their targeted goals immediately and points out shortcomings in the architecture of the EMU in the Maastricht Treaty that ought to be reformed.
store of value in the next decade. Once the single currency takes effect, the national central banks of the euro area will reduce their international reserve holdings.
Submitted by cheatsucks on August 12, 2007
Category: Social Issues
Words: 996 | Pages: 4
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The Effect of the Euro on the International Economy
The Euro is the common name for the bank notes and coins used by over 317 million Europeans(Wikipedia). It was introduced to the European Monetary Union economy in 1999 under the Maastricht Treaty on European Union. It was first used as an accounting currency only and it was not until 2002 that it began circulation as money. It is currently the second most valuable money in the world, falling only behind the British Pound. The effects of the Euro are far-reaching, touching such things as the price of crude oil, world tourism, and how businesses operate. The colored countries currently use the Euro.
The current value of the Euro is only slightly behind the British Pound, but in money terms very far ahead of the dollar. The effect of the exchange rate is that more Europeans have flocked to America for travel and vacations because their money will go so far here. This is very beneficial to America not only economically but also politically. The tourists who come here bring their money and purchase the services and goods in America, but they also affect the relations their country has with America, and vice versa. The countries using the Euro and sending tourists to America will want to maintain peace and benign relationships with America.
Euro to dollar
Euro to British Pound
Regarding business influenced by the Euro, theoretically there should be increased profitability for those countries utilizing the unionized currency.("Euro-Zone Economy") By removing the costs and drains imparted by exchanging currency, the lost revenue should now be equated to increased profits . By maintaining their economic union, the countries belonging to the EU are also able to travel in and out of the other member countries without having to worry about exchanging their money. All member countries honor the Euro whether it was produced in Germany or Slovenia. There is no...
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