European Currency Unit


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European Currency Unit (ECU)

An index of foreign exchange consisting of European currencies, originally devised in 1979. Also see Euro.

European Currency Unit

Prior to the adoption of the euro, the ECU was set up as currency basket to provide a methodology for reconciling differing exchange rates between currencies who wished to participate in the single European currency. Established in the 1979, it was known as a "semi-pegged" system in which currencies were variable with respect to each other only within a certain range. After the introduction of the euro in 1999, the exchange rate mechanism was replaced by ERM II, which reconciles exchange rates for countries wishing to join the eurozone. See also: Exchange rate mechanism.

European Currency Unit (ECU)

A weighted index of the currencies of ten European Economic Community members. For bonds denominated in ECUs, U.S. investors risk not only the possibility of interest-rate increases but also the chance that the dollar will rise relative to the ECU (that is, one ECU will buy fewer dollars). On the plus side, these securities provide investors with the opportunity of overseas diversification without reliance on the currency of a single country.

European Currency Unit

see EUROPEAN MONETARY SYSTEM.

European Currency Unit (ECU)

the former monetary asset used by member countries of the EUROPEAN MONETARY SYSTEM (EMS) to value the EXCHANGE RATES of members’ currencies which are held as part of their INTERNATIONAL RESERVES to settle payment imbalances between members. The ECU was replaced in January 1999 with the introduction of a new currency, the EURO, as part of ECONOMIC AND MONETARY UNION.

Unlike other reserve assets such as GOLD, ECUs had no tangible life of their own. They were ‘created’ by the EMS's European Monetary Cooperation Fund in exchange for the in-payment of gold and other reserve assets by members and took the form of bookkeeping entries in a special account managed by the Fund. The value of the ECU was based on a weighted basket of members’ national currencies.

References in periodicals archive ?
The German mark emerged as the preferred European currency following the collapse of the European currency unit sector of the bond market and the liberalization of Bundesbank rules regarding bond issuance.
TABLE 2 EU GDP, Debt, and Percentage of GDP 1992 1993 1994 1995 1996 1997 GDP(*) 5861.3 5876.0 6168.5 6413.4 6727.7 7007.7 Debt(*) 3510.8 3794.2 4138.9 4483.1 4843.0 5056.6 Debt/GDP % 59.9 64.6 67.1 69.9 72.0 72.2 Deficit/GDP % 5.2 6.3 5.5 7.2 4.7 3.5 Note: * denotes European currency units (ECUs) in billions.
Indeed, in 1992 the European Commission estimated that the aggregate cost of converting EU currencies approached 20 million European Currency Units (about 0.5 of one per cent of Union GDP) per year (CEC, 1992).
Loans denominated in European currency units (ECUs).
The total value of fish imported by Europeans through the first three quarters of 1990 was 12.25 billion in European Currency Units, which were convertible to a dollar value between $1.21 and $1.38 for the period.
The directive provides for damages for death or personal injury, but allows member states to place a ceiling of not less than 70 million ECUs (European Currency Units) on these damages.
According to the Council of European Communities' 90/604/EEC(8) directive, dated November 8, 1990 (modifying the previous fourth (90/604/EEC(4)) and seventh (90/604/EEC(7)) directives), the annual accounts' layout may be in both the local currency and in European currency units (ECUs).
In absolute spending terms, France is the leader at 685 million ECUs (European Currency Units), followed by Britain at 572 million, Germany at 421 million, Italy at 363 million, Denmark at 69 million, the Netherlands at 39 million and Ireland at 36 million.
The second great American myth is that somehow, after 1992, all will be different - that an economically integrated "United States of Europe" will emerge as one marketplace, where everybody will speak English and deal in European Currency Units, and differences will be as skin-deep as the differences in sales taxes and regulatory issues between North American states.
From now until December 31, 1992, the insured must have a minimum of 500 employees, annual sales of or exceeding 24 million European Currency Units (ECUs) and a balance sheet showing a minimum reserve of 12.4 million ECUs.
The EU's overall trade deficit with Japan rose to 19.5 billion European Currency Units (ECUs), or 16.79 billion U.S.

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