Munich Personal RePEc Archive

The Choice of Exchange Rate Regimes for EU Accession Countries

Kirrane, Chris (2003): The Choice of Exchange Rate Regimes for EU Accession Countries. Published in: European Political Economy Review , Vol. No. 2, No. Autumn (1 August 2003): pp. 188-206.

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Abstract

This article examines the institutional changes of Central Banks and the exchange rate regimes of Eastern European countries joining the EU. Current regimes and how they need to evolve in order to meet the entry criteria of the EU and EMU are looked at. In addition, the degree to which the candidate countries meet the accession criteria and compare them with the performance of the latest EU entrants will be studied. After concluding that the accession criteria do not necessarily favour a particular exchange rate regime, the pros and cons of the two plans considered as the most stable, currency board and inflation target will be analysed. Under these two regimes, the respect of the criteria of low inflation and exchange rate stability is likely to produce strong tensions.

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