STOCKHOLM: Europe is now preparing for a new currency - the euro. Advocates of EMU argue that adoption of a single currency will have many positive effects, both at the micro and the macro level. At the “micro” level, the transaction costs and uncertainties imposed on all businesses by the daily exchange of one currency for another are supposed to decrease, delivering large gains in efficiency as a result. At the “macro” level, the main effect is assumed to be lower interest rates, with positive effects on European investment and economic growth.
STOCKHOLM: Europe is now preparing for a new currency - the euro. Advocates of EMU argue that adoption of a single currency will have many positive effects, both at the micro and the macro level. At the “micro” level, the transaction costs and uncertainties imposed on all businesses by the daily exchange of one currency for another are supposed to decrease, delivering large gains in efficiency as a result. At the “macro” level, the main effect is assumed to be lower interest rates, with positive effects on European investment and economic growth.