ABSTRACT
The euro was expected to be a strong currency, but doubts about the firmness of the European Central Bank’s monetary policy in the face of high unemployment rates in Europe led to speculative pressures which caused it to depreciate from $1.17 to about 85 US cents in 1999-2001, before it recovered to about $1.15 between the spring of 2002 and mid-2003. Eight new countries (Hungary, the Czech Republic, Poland, Estonia, Latvia, Lithuania, Slovenia, and Malta) are scheduled to join the European Union in 2004, and to join EMU in 2006.
