Europe currency System

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Sorry about that I did not update my experience on time in the past weeks because here comes the busy weeks and I had to complete several exams and assignments. Having stayed in Spain for two months, I gained some knowledge about the economy and culture. One thing I want to say is about the EUR currency system. Although it may reduce the cost and service for exchanging between different countries but I don’t think it is really beneficial to all countries.

The euro (sign: €; code: EUR) is the currency used by the European Union and is the official currency of the euro zone  17 of the 28 member states of the European Union are using the currency: Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece,Ireland, Italy, Luxembourg, Malta, the Netherlands, Portugal, Slovakia, Slovenia, and Spain.

However, the economic levels of the 17 countries are different. Some have better economy and export and others do not. For those having more exports and better economy, their currencies are tend to appreciate if they have their own. And the bad-economy countries’ currencies will depreciate to make their products more cheaper in oversea and domestic market. But if they all use the same currency, the exchange rate probably will reflect the average economy level of 17 countries. The better countries will gain advantage from the under-valued currency and the troubled countries will have disadvantage.

The US treasury has noticed the issue. http://online.wsj.com/news/articles/SB10001424052702304527504579168113091545256

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