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Dollar-Euro Exchange Rate 1999-2004 - Dollar and Euro as International Currencies

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  • Shams, Rasul

Abstract

On January 1,1999 euro became the currency for 11 member states of the European Union. Since then the dollar-euro exchange rate has completed a full turning. Three years of depreciation of the euro followed by three years of appreciation without wild fluctuations asks for an explanation which would adequately account for the position of the euro as an emerging international currency. In this paper, first we present a concise summary of the theory of world money. Then we apply the theory to explain the development of the exchange rat of euro versus dollar in the subperiods 1999-2002 and 2002-2004.

Suggested Citation

  • Shams, Rasul, 2005. "Dollar-Euro Exchange Rate 1999-2004 - Dollar and Euro as International Currencies," Discussion Paper Series 26228, Hamburg Institute of International Economics.
    • Handle: RePEc:ags:hwwadp:26228
    DOI: 10.22004/ag.econ.26228
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    References listed on IDEAS

    as
    1. Hans-Werner Sinn & Frank Westermann, 2001. "Why Has the Euro Been Falling?," CESifo Working Paper Series 493, CESifo.
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    8. Beckmann, Rainer & Born, Jürgen & Kösters, Wim, 2001. "The US dollar, the euro, and the yen: An evaluation of their present and future status as international currencies," MPRA Paper 5274, University Library of Munich, Germany.
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