Until I saw an article in last Sunday’s paper I did not realize that early next year the Euro will be replacing the existing currency in all the countries that have signed up for this new common currency. This means that anybody planning a trip to these countries this year must make sure that they are not left with any Franks,Pestos,Marks etc.These will cease to be legal tender after the changeover date.So if anybody tries to use them in these countries next year they will find they are no good,though I think they might be able to change them a central banks for Euros.Be warned!
And the question here is…?
The euro, in fact, is being currently used, and has been in use since, IIRC, 1999. Only in electronic transactions, though. All the currencies in the Euro zone no longer fluctuate independently of each other. Each currency is part of the basket of currencies that comprise the Euro. This means that deutschemark, french franc, belgian franc, guilder, etc, have had fixed exchange rates with each other since Dec 31, 1998. They no longer trade independently on the market, but are fractions of the euro. For example, the deutschmark is worth almost 1/2 a euro (1/1.95583 to be precise), the guilder is 1/2.2, the lira is 1/1936.27, etc… Hence, the value of these currencies now fluctuate with the value of the dollar to the euro.
In most places in the Euro zone you will see dual pricing, one in the local currency and one in Euros, in order to get consumers used to the fact that they will soon be dealing with a whole new set of numbers. This is really helpful, as it’s much easier to convert Euros to dollars then, say, lira.
As for the future, as of Jan 2002, the physical Euro currency will be introduced and the member states have until June 30 to phase out the local currencies.
If you’ve recently done any sort of credit card transaction in Europe, there’s a chance that you will see a Euro credit rather than a local currency. I’ve had it both ways on my card.
Hmm… I thought the euro was pegged at a fixed rate of 1 euro per US Dollar, and local currencies floated against the euro.
I suppose it doesn’t make much difference because the standard is and always will be US greenbacks.
I’m not sure what you’re looking for here, but the only question I actually got out of this is how well informed people are. I live in Wisconsin USA and talked about it in my french class today, so I think the word has gotten around. Although I don’t beleive they’re dropping the other curreny for a year or two yet, or so I’m told.
chas –
no, no, no. Unless I’m misunderstanding you (which is quite possible) the Euro floats against the dollar.
I worked for a business paper in Europe and there was all sorts of craziness when the Euro fell under the parity point with the dollar. IIRC, the Euro fell to as low as one euro being worth 83 cents. I’m a little lazy to look up the history, but it started out at around the $1.20 mark at its intro in 1999 and now is worth somewhere in the 90-some cent range.
Technically, the old currencies ceased to exist when their exchange rate was fixed to the euro (I believe this was 1 Jan 1999). Lots of people have trouble with this concept because physically, the old bills and coins were still circulating. What happened on that date was that those notes stopped representing marks, francs, lira, etc. and started representing euros.