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Euro zone and its monetary policy

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  • Dorel Dumitru CHIRITESCU
  • Andreea ANDRASIU

    (Constantin Brancusi University, Faculty of Economics, Romania)

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    Abstract

    In this article I have tried to make a short presentation of the Euro Zone and it’s monetary policy. At the present moment the Euro Zone has 16 countries that have adopted the Euro as a national currency and also 4 small countries that have monetary agreements with their neighbours. The monetary policy represents all the regulations of the money supply and interest rates adopted by the European Central Bank in order to control the inflation rate and to stabilize a specific currency, in this case, the Euro. Stabilizing the inflation rate to certain levels is the main goal of the monetary policy. The monetary policy is the second policy, next to the fiscal one which in which a government, in this case the European Union’s official bodies, can impact the economic situation of the Eurozone. The fiscal policy represents the way a government spends, borrows or applies different types of taxes. The Monetary policy can be either expansionary, when unemployement and recessions needs to be combated, or contractionary, when inflation is conbated byt raising the interest rates.

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    Bibliographic Info

    Article provided by Constantin Brancusi University, Faculty of Economics in its journal Constatin Brancusi University of Targu Jiu Annals - Economy Series.

    Volume (Year): 1 (2010)
    Issue (Month): (April)
    Pages: 49-52

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    Handle: RePEc:cbu:jrnlec:y:2010:v:1:p:49-52

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    Keywords: monetary policy; Euro Zone; monetary market; European Union; prices;

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