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Published by: Centre for Islamic Banking and Finance
Published in: 1999

Abstract

The introduction of the euro on January 1st 1999 has meant that relationships between members of the euro bloc, mostly the former EMS currencies, have now altered. After summarising the new euro parities, this case describes the impact of the euro on the exchange rate regimes applied in both non-participating European countries and on other countries affected by the change. A summary of Central and Eastern Europe exchange rate regimes is then provided. This case is suitable for undergraduate and postgraduate courses with an international finance, international banking or international business component. The themes covered also provide an analytical framework in which multi-national company decision making has to be analysed whether from the point of view of international finance, international marketing or international corporate strategy. It is particularly suitable for business situations where foreign exchange hedging and arbitrage decisions are being discussed.

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Abstract

The introduction of the euro on January 1st 1999 has meant that relationships between members of the euro bloc, mostly the former EMS currencies, have now altered. After summarising the new euro parities, this case describes the impact of the euro on the exchange rate regimes applied in both non-participating European countries and on other countries affected by the change. A summary of Central and Eastern Europe exchange rate regimes is then provided. This case is suitable for undergraduate and postgraduate courses with an international finance, international banking or international business component. The themes covered also provide an analytical framework in which multi-national company decision making has to be analysed whether from the point of view of international finance, international marketing or international corporate strategy. It is particularly suitable for business situations where foreign exchange hedging and arbitrage decisions are being discussed.

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