The Monetary Policies of the European Central Bank and the Euro's (Mal)Performance: A Stability-Oriented Assessment
AbstractThe stability-oriented macroeconomic framework established in the Maastricht and Amsterdam Treaties on European Union (TEU), especially the unparalleled status of independence and peculiar mandate of the European Central Bank (ECB), were promised to virtually guarantee price stability and a "strong" euro. Actual developments have shattered these hopes in a rather drastic way. Despite the dismal monetary developments, conventional wisdom holds that neither the Maastricht regime nor the ECB might possibly be at fault. Yet, the euro's performance over 2000–01 is generally seen as a puzzle. This paper assesses the ECB's role in relation to the euro's (mal-) performance, explores the institutional setting and traditions behind the ECB's conduct, and scrutinizes the rationale that inspired its interest rate policies.
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Length: 10 pages
Date of creation: 28 Sep 2001
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Find related papers by JEL classification:
- E - Macroeconomics and Monetary Economics
This paper has been announced in the following NEP Reports:
- NEP-ALL-2001-10-01 (All new papers)
- NEP-CBA-2001-10-01 (Central Banking)
- NEP-EEC-2001-10-01 (European Economics)
- NEP-MON-2001-10-01 (Monetary Economics)
- NEP-PKE-2001-10-01 (Post Keynesian Economics)
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