In January 1999 eleven countries of the European Union locked their foreign exchange rate to the Euro and committed themselves to annul their own currency in favour of the Euro in the year 2000 (Bradley S and Whittaker J, 2000, Industrial Relations Journal, 31, 4, 261). Of particular interest and complexity are the relationships between countries within the euro zone and other economies worldwide. The relationship between the European economies and the European Central Bank (ECB) and its consequences in global context is a central issue in this report. Therefore, the previous research about the ECB has concentrated on its influence towards European and other global economies. The members of the current euro zone are: France, Germany, Italy, Austria, Belgium, Finland, Greece, Luxembourg, the Netherlands, Portugal and Spain. Apart from this, Denmark, Sweden and the United Kingdom are members of the European Union, which have not adopted the euro yet. These three countries are European economies even when they play another role in global context because of their own currency: British Pound, Danish Krone and Swedish Krona. Accordingly, the remainder of this paper is divided into four sections, reasons for establishing the ECB and its objectives, how decisions of the ECB concerning the interest rate may influence economies worldwide, a briefly annotation of advantages and disadvantages for members of the euro zone and a conclusion including a short outlook.
Inhaltsverzeichnis (Table of Contents)
- Contents
- Appendix
- Diary of Events of the European Central Bank
- Annotated Bibliography
- References
Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)
This report aims to analyze the relationship between the European Central Bank (ECB) and European economies in a global context. The report explores the ECB's influence on European and global economies and considers the implications of its decisions on the euro zone's member states.
- Establishment and objectives of the ECB
- Impact of ECB interest rate decisions on economies worldwide
- Advantages and disadvantages of euro zone membership
- The role of trust and reputation in the ECB's effectiveness
- The influence of the ECB's monetary policy on European and global economies
Zusammenfassung der Kapitel (Chapter Summaries)
The report begins by discussing the establishment of the ECB and its primary objective of ensuring price stability within the euro zone. It outlines the ECB's four subordinate objectives, including the implementation of monetary policy, foreign exchange operations, management of official foreign exchange reserves, and promotion of a smooth payments system. The report then delves into the mechanics of central banking, highlighting the role of central banks in setting the monetary framework for financial and economic institutions.
The report goes on to discuss the importance of trust in central bank decisions and how the ECB has earned the trust of market participants worldwide. It examines the ECB's influence on economies through its monetary policy tools, including minimum required reserve levels, open market operations, and standing facilities. The report focuses specifically on the consequences of ECB decisions concerning interest rates, highlighting their immediate effects on economies both within and outside the euro zone.
Schlüsselwörter (Keywords)
The key concepts and themes explored in this report include the European Central Bank (ECB), European economies, monetary policy, interest rates, price stability, euro zone, trust, global context, economic influence, and financial institutions. The report also examines the impact of central bank decisions on economic growth, currency exchange rates, and credit conditions.
- Quote paper
- Nicole Brand (Author), 2005, The European Central Bank and European economies in global context, Munich, GRIN Verlag, https://www.grin.com/document/49292
