WHAT IS EURO....... KNOW IT ........

The euro, often signified by €EUR, is the currency used in 12 members of the European Union, as well as regions such as Montenegro, Kosovo, Andorra and more. The euro is the result of the most significant monetary reform in Europe since the Roman Empire. While creation of this currency is most obviously a channel through which Europe may perfect a single market (by facilitating free trade between members of the Eurozone), the euro is just as importantly a means through which Europe may achieve political integration.

Although the euro was only formally put into circulation on January 1, 2002, the idea of creating "an ever closer union among the peoples of Europe" has been around for decades-as stated in the Treaty of Rome in 1957. In 1979, the European Monetary System (EMS) was introduced and locked exchange rates among participating countries, which aided efforts to stabilize the economy. In 1992, the Economic and Monetary Union (EMU) was formed which set the basics for the creation of the single currency. Seven years later on January 1, 1999-the euro was born when the participating countries established exchange rates between their own currencies and the euro creating a monetary union. It took three years of transition, where the euro was only used as electric money, until actual euro notes and coins were used. Now, the 12 euro area member states have a single currency, a common interest rate, and a common central bank (European System of Central Banks.) It is the largest monetary replacement the world has ever seen.

The euro is administered by the European System of Central Banks (ESCB), which is comprised of the European Central Bank (ECB) and the Eurozone central banks. Headquartered in Frankfurt, Germany, the ECB has the sole authority to set monetary policy; other members of the ESCB participate through printing, minting, and distributing notes and coins.

Where is the Euro Used?
The countries in the European Union that use the euro are:
Belgium, Germany, Greece, Spain, France, Ireland, Italy, Luxembourg, The Netherlands, Austria, Portugal, Finland

Where is the NOT Euro Used?
EU countries not using the euro are: Denmark, Sweden, and the U.K.
Other territories using the euro are: Andorra, Monaco, San Marino, The Vatican, Martinique, Guadalupe (Caribbean), Reunion (Indian Ocean), Montenegro,Kosovo

What does it look like?

Political Structure
The European Union (EU) is comprised of 25 democratic states. It was established in 1992 by the Treaty on European Union and is headquartered in Brussels. The members of the EU are: Austria, Belgium, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxemburg, Malta, Poland, Portugal, Slovakia, Slovenia, Spain, Sweden, The Netherlands and the United Kingdom. All decisions and procedures in the EU are based on treaties agreed upon by these countries. Since its establishment, people, goods, services and money are free to move throughout the union as if it were one country.

Prominent Figures

Country	Political Leader
Austria	Heinz Fischer
Belgium	Guy Verhofstadt
Cyprus	Tassos Nikolaou Papadopoulos
Czech Republic	Jiri Paroubek
Denmark	Anders Fogh Rasmussen
Estonia	Arnold Ruutel
Finland	Tarja Kaarina Halonen
France	Jacques Chirac
Germany	Angela Merkel
Greece	Karolos G. Papoulias
Hungary	Ferenc Madl
Ireland	Mary Patricia McAleese
Italy	Silvio Berlusconi
Latvia	Vaira Vike-Freiberga
Lithuania	Valdas Adamkus
Luxemburg	Jean-Claude Juncker
Malta	Edward Fenech Adami
Poland	Aleksander Kwasniewski
Portugal	Jorge Sampaio
Slovakia	Ivan Gasparovic
Slovenia	Janez Drnovsek
Spain	Jose Luis Rodriguez Zapatero
Sweden	Goran Persson
The Netherlands	Jan Peter Balkenende
United Kingdom	Tony Blair

Unique Characteristics
The economy of the euro zone is much larger and more closed than the economies of most individual countries. With over 300 million individual participants, it is the largest economy in the world. The EU maintains its economic stature by enforcing high macroeconomic standards. Over the years, the EU has lowered inflation, interest rates and unemployment, and demands these characteristics from any country that wishes to adopt the euro. For example, a nation must have no more than a 3% inflation rate to use the euro as its currency. Although the euro zone has a more open economy than those of countries such as the Unites States or Japan, it is more closed relative to many other economies, which limits external economic developments in the euro zone.

The major imports of the euro zone are raw materials and intermediate goods.

The euro, as compared with the dollar is very strong. More euros are circulating within the market, than dollars, because of the union's huge connection to OPEC and oil prices.

Key Economic Factors
US Trade Balance Report: Analyzing the value of the euro currency against that of the U.S. dollar, a major factor that influences the relative values is the US Trade Balance Report. Released monthly, the EUR/USD value is dependent upon whether the deficit expands or contracts. The EUR/USD value is likely to travel in the same direction the deficit amount does (i.e. if the deficit increases, the euro will increase in value relative to the U.S. dollar).

Economic Data
Many people are watching Europe's economy very closely. The growth of the union is much slower as compared to the surrounding economies.

Swiss unemployment has been a problem for the euro. In June 2005, the rates stood at 3.8% with high youth unemployment and long-term joblessness as significant problems.

Germany has been on a rebound in 2005 in regards to manufacturing orders. The Purchasing Manager's Index revealed that the number of new export orders has increased. However, industrial production as well as domestic economic activity has been on the decline.

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