BOP POSITION AND IMPACT ON INDIAN ECONOMY
INTERNATIONAL FINANCE ASSIGNMENT
TOPIC : EUROPEAN MONETARY SYSTEM, BOP POSITION AND IMPACT ON INDIAN ECONOMY
EUROPEAN MONETARY SYSTEM
INTRODUCTION
European Monetary System (EMS) was an arrangement established in 1979 under the Jenkins European Commission where most nations of the European Economic Community (EEC) linked their currencies to prevent large fluctuations relative to one another
. It was organized in 1979 to stabilize foreign exchange and counter inflation among members. The European Currency Unit (ECU), which also was established in 1979, was the forerunner of the euro. Derived from a basket of varying amounts of the currencies of the EU nations, the ECU was a unit of accounting used to determine exchange rates among the national currencies..
In 1994 the European Monetary Institute was created as transitional step in establishing the European Central Bank (ECB) and a common currency (the euro). The ECB, which was established in 1998 and has its headquarters in Frankfurt, Germany, is an official institution of the EU and is responsible for setting a single monetary policy and interest rate for the eurozone nations, in conjunction with their national central banks. In June 1998, the European Central Bank was established and, in January 1999, a unified currency, the euro, was born and came to be used by most EU member countries. In Dec., 2010, EU nations agreed to establish the European Stability Mechanism (ESM), a permanent fund to aid financially troubled member nations that came into being in Oct., 2012 .In July, 2012, EU nations agreed to establish a financial supervisory authority under the ECB to oversee the eurozone's largest banks and also to allow bailout
TOPIC : EUROPEAN MONETARY SYSTEM, BOP POSITION AND IMPACT ON INDIAN ECONOMY
EUROPEAN MONETARY SYSTEM
INTRODUCTION
European Monetary System (EMS) was an arrangement established in 1979 under the Jenkins European Commission where most nations of the European Economic Community (EEC) linked their currencies to prevent large fluctuations relative to one another
. It was organized in 1979 to stabilize foreign exchange and counter inflation among members. The European Currency Unit (ECU), which also was established in 1979, was the forerunner of the euro. Derived from a basket of varying amounts of the currencies of the EU nations, the ECU was a unit of accounting used to determine exchange rates among the national currencies..
In 1994 the European Monetary Institute was created as transitional step in establishing the European Central Bank (ECB) and a common currency (the euro). The ECB, which was established in 1998 and has its headquarters in Frankfurt, Germany, is an official institution of the EU and is responsible for setting a single monetary policy and interest rate for the eurozone nations, in conjunction with their national central banks. In June 1998, the European Central Bank was established and, in January 1999, a unified currency, the euro, was born and came to be used by most EU member countries. In Dec., 2010, EU nations agreed to establish the European Stability Mechanism (ESM), a permanent fund to aid financially troubled member nations that came into being in Oct., 2012 .In July, 2012, EU nations agreed to establish a financial supervisory authority under the ECB to oversee the eurozone's largest banks and also to allow bailout