The euro is the official currency of the European Union. The euro is symbolised by € and has a currency code of EUR. Introduced in 1999, the euro is the national currency for the countries that make up the eurozone. As well, several European Union (EU) institutions and other European countries have adopted the euro. The euro is used daily by more than 300 million Europeans. With more than €900 billion in circulation, the euro is one of the most traded currencies in the world, second only to the US dollar. The euro is controlled by the European Central Bank (ECB).


Euro History

Calls for a European currency have been made since the early part of the 20th century. As exchange rates experienced high volatility, European leadership sought to gain a political foothold for unity.

On 7 February 1992, members of the European Community signed the Maastricht Treaty in the Netherlands. The treaty in effect created a currency union, the EU, with the euro as the single European currency. In order to gain membership in the EU, members had to demonstrate sound fiscal policies in terms of inflation rates, deficits, exchange rates and long-term interest rates. This eurosystem—the collection of EU member states—is the controlling monetary authority of the eurozone.

When launched 1 January 1999, the euro took a non-physical form, exclusive to electronic funds, all bonds and debts, with legacy coins and banknotes maintaining their legal tender status. On 1 January 2002, 7.4 billion euro notes and 38.2 billion euro coins were issued into the eurozone. Though the euro had an early slump, the value increased rapidly over the years with growing membership in the EU, international adoption and its usage as a stable trading currency.

Currencies Replaced by the Euro

1) Retrieved 6 July 2015.

  • Austrian Schilling
  • Belgian Franc
  • Cypriot Pound
  • Estonian Kroon
  • Finnish Markka
  • French Franc
  • German Mark
  • Greek Drachma
  • Irish Pound
  • Italian Lira
  • Latvian Lats
  • Lithuanian Litas
  • Luxembourgish Franc
  • Maltese Lira
  • Dutch Gulden
  • Portuguese Escudo
  • Slovak Koruna
  • Slovenian Tolar
  • Spanish Peseta

Non-Euro EU Countries

Several European countries joined the EU, but continue to use their standard currencies rather than adopting the euro.2) Retrieved 6 July 2015.

Country Currency
Bulgaria Lev
Croatia Croatian Kuna
Czech Republic Koruna
Denmark Krone
Hungary Forint
Poland Zloty
Romania Leu
Sweden Krona
United Kingdom Pound
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Euro In Trade

Because of the high volume of buyers and sellers, the euro is one of the most traded currencies. As a forex pair, the euro has precedence in all cross pairs. Pairs include: EUR/NZD, EUR/AUD, EUR/SEK, EUR/CAD, EUR/TRY, EUR/CHF, EUR/USD, EUR/GBP, EUR/JPY, EUR/NOK.

Germany, France, Italy and Spain make up three-quarters of the eurozone’s GDP. Many traders follow economic news announcements from these countries because of their large influence on the euro’s place in the forex market. The Consumer Price Indices, ECB announcements, GDP reports and others are common indicators on the state of the European economy.

Euro Bills and Coins

Since 2002, euro banknotes have been issued by the ECB and the National Central Banks of the eurozone. Notes are denominated in €5, €10, €20, €50, €100, €200 and €500, and are identical throughout the eurozone, designed with themes of architecture. Notes features complex security features like invisible ink, holograms and microprinting for authenticity. As of 2014, the ECB estimates more than 16 billion euro banknotes in circulation.

The euro is divided into 100 cents, and euro coins are denominated in €0.01, €0.02, €0.05, €0.10, €0.20, €0.50, plus €1 and €2 coins. Euro coins have a common side, featuring a map of Europe. Each country is allowed to design the national side of the coins with some restrictions. As of 2014, the ECB estimates more than 110 billion euro coins in circulation.

Official Users

  • Austria
  • Belgium
  • Cyprus
  • Estonia
  • Finland
  • France
  • Germany
  • Greece
  • Ireland
  • Italy
  • Latvia
  • Lithuania
  • Luxembourg
  • Malta
  • Netherlands
  • Portugal
  • Slovakia
  • Slovenia
  • Spain

Currencies Pegged to the Euro

  • Bosnia & Herz. convertible mark
  • Bulgarian lev
  • Cape Verdean escudo
  • Central African CFA franc
  • CFP franc
  • Comorian franc
  • Danish krone (±2.25%)
  • Moroccan dirham
  • São Tomé and Príncipe dobra
  • West African CFA franc

Any opinions, news, research, analyses, prices, other information, or links to third-party sites are provided as general market commentary and do not constitute investment advice. FXCM will not accept liability for any loss or damage including, without limitation, to any loss of profit which may arise directly or indirectly from use of or reliance on such information.

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