The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd

European Central Bank and Monetary Policy in the Euro Area

  • Vítor Gaspar
  • Otmar Issing
Reference work entry
DOI: https://doi.org/10.1057/978-1-349-95189-5_2989

Abstract

Since 1 January 1999 the European Central Bank (ECB) has had sole responsibility for monetary policy in the euro area. Its main aim is to maintain price stability over the medium term. It is completely independent. The ECB has been successful in maintaining price stability and well-anchored inflation expectations. The euro is now a well-established international currency and a symbol of European integration. The financial and economic crises of 2007–2011 made the tension between the single monetary policy and national responsibilities for economic policies and financial stability visible. This is the main challenge going forward.

Keywords

Euro European Union European Central Bank Monetary policy Price stability Expectations Credibility Finance 

JEL Classifications

E52 E58 E61 F55 
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Copyright information

© Macmillan Publishers Ltd. 2018

Authors and Affiliations

  • Vítor Gaspar
    • 1
  • Otmar Issing
    • 1
  1. 1.