One of the lessons of the recent crises is: the vast majority – if not all – of the countries affected by the crises had pegged their exchange rates too rigidly. VI In the future euro area, the exchange rate safety valve will be irrevocably shut from January 1, 1999. The financial markets have already accepted the forthcoming monetary union.
They regard the announced irrevocable exchange rates of the participating countries as credible. And by yesterday’s decision of 10 European national central banks to lower interest rates, it has been demonstrated: we are already in a de facto monetary union. The euro has undoubtedly already passed its first severe test during the financial market turbulence of the past few months.