The euro (sign: €) is the official currency of the
eurozone: 17 of the 27 member states of the European Union (EU). It is also the currency used by the EU institutions. The eurozone consists of Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Malta, the Netherlands, Portugal, Slovakia, Slovenia and Spain. The currency is also used in a further 5 European countries (Montenegro, Andorra, Monaco, San Marino, Kosovo and the Vatican) and is consequently used daily by some 327 million Europeans. Additionally, over 175 million people worldwide use currencies which are pegged to the euro, including more than 150 million people in Africa.
The euro is the second largest reserve currency as well as the second most traded currency in the world after the U.S. dollar..
The name euro was officially adopted on 16 December 1995. The euro was introduced to world financial markets as an accounting currency on 1 January 1999, replacing the former European Currency Unit (ECU) at a ratio of 1:1. Euro coins and banknotes entered circulation on 1 January 2002.
The euro is managed and administered by the Frankfurt-based European Central Bank (ECB) and the Eurosystem (composed of the central banks of the eurozone countries). As an independent central bank, the ECB has sole authority to set monetary policy. The Eurosystem participates in the printing, minting and distribution of notes and coins in all Member States, and the operation of the eurozone payment systems.
Currency-specific guidance for events
- ECB Interest Rate announcement - it is important to understand that ECB press conferences are delivered in 2 parts: the first part is the prepared statement by the President of the ECB a copy of which is available on ECB´s official website. Then it will be followed by a Q&A session, where onsite media members have the opportunity to pose questions to the President. Market reaction is therefore unpredictable, with it best to stay out of the market until the press conference is completed.
Always remember that trading foreign exchange on margin carries a HIGH LEVEL OF RISK
, and may not be suitable for all investors. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.