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103-581: The European System of Central Banks ( ESCB ) is an institution that comprises the European Central Bank (ECB) and the national central banks (NCBs) of all 27 member states of the European Union (EU). Its objective is to ensure price stability throughout the EU, and improve monetary and financial cooperation between eurozone and non-eurozone member states of the EU. The process of decision-making in

206-583: A "Securities Market Programme" (SMP) which involved the discretionary purchase of sovereign bonds in secondary markets. Extraordinarily, the decision was taken by the Governing Council during a teleconference call only three days after the ECB's usual meeting of 6 May (when Trichet still denied the possibility of purchasing sovereign bonds). The ECB justified this decision by the necessity to "address severe tensions in financial markets." The decision also coincided with

309-499: A European Regulation approved new specifications of euro coins and named (in article 1 g) a deadline for national sides of regular coins to be updated to fully comply with the current regulation: 20 June 2062. In 2014, a new Regulation regarding euro coins was approved. In it, no changes related to what was mentioned above were established. As of 2016 , Belgium, Monaco, the Netherlands, Spain and Vatican City have all experienced

412-532: A change in head of state and have revised their designs to reflect this and the new regulation where applicable. In 2022, France came to comply with the stars' rule after the design change it made on the 1 and 2 euro coins, in which the year had until then been inserted between the stars of the Union. As of 2023 , Austria, Germany and Greece still have to include an indication of the issuing Member State. Additionally, Greece, Luxembourg and Slovenia have to comply with

515-517: A change of communication style, in particular in her use of social media to promote gender equality, and by opening dialogue with civil society stakeholders. The onset of the COVID-19 pandemic has precipitated an unprecedented crisis, profoundly impacting global public health, economies, and societal structures on an unparalleled scale. The COVID-19 crisis stands in contrast to the 2007-2008 Global Financial Crisis as it represents an exogenous shock to

618-485: A common reverse side showing how much the coin is worth, with a design by Belgian designer Luc Luycx . The design of the 1c, 2c and 5c coins shows Europe's place in the world as a whole. The 10c coins and above show either the 15 countries that were the European Union in 2002, or, if minted after 2007, the whole European continent. Coins from Italy , San Marino , the Vatican , Austria and Portugal show

721-594: A common commemorative coin was issued to commemorate 30 years of the European Union flag . Finally, in 2022 a common commemorative coin was issued to commemorate 35 years of the Erasmus Programme . In 2006, Germany began issuing a series of coins, the German Bundesländer series , showing each of the states of Germany on its coins; It was originally intended to run until 2021, but one extra issue

824-453: A contagion of the Greek crisis towards other Eurozone countries. The assumption—largely justified—was that speculative activity would decrease over time and the value of the assets increase. Although SMP purchases did inject liquidity into financial markets, all of these injections were "sterilized" through weekly liquidity absorption. So the operation was net neutral in liquidity terms (though this

927-617: A fixed exchange rate policy with the euro). In 1999, the currency was born virtually and in 2002 notes and coins began to circulate. It rapidly replaced the former national currencies and the eurozone has since expanded further to some newer EU states . In 2009 the Lisbon Treaty formalised its political authority, the Eurogroup , alongside the European Central Bank . In 2004, €2 commemorative coins were allowed to be minted in six states. By 2007, all states but France , Ireland and

1030-460: A grooved edge to distinguish it from the 1 and 5 cent coins and also from the US ;penny , which has the same colour and diameter. Similarly, the 20 cent coin edge is smooth with seven indents to distinguish it from the 10 and 50 cent coins. While currencies predating the euro were specifically designed in similar ways (different sizes, colours, and ridges) to aid the visually impaired,

1133-462: A level otherwise none of us is willing to accept,[...].", as economists feared that the strong economies would come out of the crisis stronger while weak economies would deteriorate because of the crisis. The PEPP is thus a tool used by the ECB to purchase both private and public securities according to the specific needs of EU-countries caused by the COVID-19-crisis. The temporal flexibility from

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1236-458: A limit on the number that can be issued. The coin must adhere to the normal design criteria, such as the twelve stars , the year and the issuing country. Greece was the first country to issue a commemorative coin, and was followed by other countries. In 2007, every eurozone state participated in the Treaty of Rome programme, in which all member states issued a coin of similar design to commemorate

1339-437: A new version, identified by smaller and more rounded numeral and longer lines outside of the stars at the coin's circumference. Cyprus is shown several hundred kilometers northwest of its real position in order to include it on the map. On the €1 and €2 coins, the island is shown to be directly east of mainland Greece ; on the €0.10, €0.20 and €0.50 coins, it appears directly below Crete . The original proposal from

1442-521: A press conference a set of policy measures to support the European economy in the rising wake of the pandemic, saying that "all the flexibilities that are embedded in the framework of the asset purchase programme [...]" but at the same time she stated that the ECB "[...] is not here to close spreads." This left markets disappointed and let to a particular widening yield spreads in Spain, Italy and Greece. However,

1545-492: A self-fulfilling panic on financial markets: the more Greek bonds yields rose, the more likely a default became possible, the more bond yields increased in turn. This panic was also aggravated because of the reluctance of the ECB to react and intervene on sovereign bond markets for two reasons. First, because the ECB's legal framework normally forbids the purchase of sovereign bonds in the primary market (Article 123. TFEU), An over-interpretation of this limitation, inhibited

1648-470: A sovereign bond below that threshold, many banks would suddenly become illiquid because they would lose access to ECB refinancing operations. According to former member of the governing council of the ECB Athanasios Orphanides , this change in the ECB's collateral framework "planted the seed" of the euro crisis. Faced with those regulatory constraints, the ECB led by Jean-Claude Trichet in 2010

1751-565: A substantial part of the ECB profits would never be refunded to Greece. The ECB played a controversial role in the " Troika " by rejecting most forms of debt restructuring of public and bank debts, and pressing governments to adopt bailout programmes and structural reforms through secret letters to Italian, Spanish, Greek and Irish governments. It has further been accused of interfering in the Greek referendum of July 2015 by constraining liquidity to Greek commercial banks. In November 2010, reflecting

1854-399: A total 192 different euro coins, not counting annual differences or commemorative coins. The basis for the euro coins is derived from a European recommendation from 2003, which allowed changing the national obverse sides of euro coins from 1 January 2004 onwards. However, a number of recommendations and restrictions still apply. Euro coins must still have a common reverse side, so only

1957-672: A €2 commemorative coin until 2017. As the EU's membership has since expanded in 2004 , 2007 and 2013 , with further expansions envisaged , the common face of all euro coins from the value of 10c and above were redesigned in 2007 to show a new map. Slovenia joined the eurozone in 2007, Cyprus and Malta joined in 2008, Slovakia in 2009, Estonia in 2011, Latvia in 2014, Lithuania in 2015 and Croatia in 2023, introducing eight more national-side designs. Andorra started minting coins in 2014, so by 2023 there are 24 countries with their own national sides in circulation. Bulgaria

2060-600: Is an asset purchase programme initiated by the ECB to counter the detrimental effects to the Euro Area economy caused by the COVID-19 crisis. To counter the COVID-19 crisis the ECB has established the Pandemic Emergency Purchase Programme (PEPP), in which the ECB is able to purchase securities from the private and public sector in a flexible manner, with the purpose to prevent sovereign debt spreads to reach

2163-628: Is prohibited by the EU Treaty. The Financial Times Deutschland referred to this episode as "the end of the ECB as we know it", referring to its hitherto perceived "hawkish" stance on inflation and its historical Deutsche Bundesbank influence. As of 18 June 2012, the ECB in total had spent €212.1bn (equal to 2.2% of the Eurozone GDP) for bond purchases covering outright debt, as part of the Securities Markets Programme. Controversially,

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2266-638: Is the central component of the Eurosystem and the European System of Central Banks (ESCB) as well as one of seven institutions of the European Union . It is one of the world's most important central banks with a balance sheet total of around 7 trillion. The ECB Governing Council makes monetary policy for the Eurozone and the European Union , administers the foreign exchange reserves of EU member states, engages in foreign exchange operations, and defines

2369-530: Is the eurozone's riskiest issuer. Non-financial commercial paper with a remaining maturity of at least 28 days was also eligible for purchase under the PEPP. The maturity criteria for public sector ranges form 70 days up to 30 years and 364 days. As the PEPP can deviate from the capital key strategy, there is also no hard limit on the 33% of a single security per issuer or 33% of a member state's total outstanding security. On 12 March 2020, Christine Lagarde announced in

2472-621: Is the last EU member state to announce its national design . The design of the euro coins was officially chosen by the Bulgarian National Bank in November 2023 and approved by the Council of the EU in February 2024. The minting of the coins in the necessary quantities will start shortly after the Council of the EU approves Bulgaria to adopt the euro, so that they can be put into circulation from

2575-643: The European Commission was to include Turkey on the map, but this design was rejected by the Council . The original designs of the 10c, 20c and 50c coins showed the outline of each of the 15 EU member states. Each state was shown as separate from the others, thus giving Europe the appearance of an archipelago . EU member states outside the eurozone ( Denmark , Sweden , and the United Kingdom ) were also depicted. Non-EU states were not depicted. On

2678-736: The Eurosystem is centralized through the decision-making bodies of the ECB, namely the Governing Council and the Executive Board . As long as there are EU member states which have not adopted the euro , a third decision-making body, the General Council, shall also exist. The NCBs of the member states that do not participate in the eurozone are members of the ESCB with a special status – while they are allowed to conduct their respective national monetary policies, they do not take part in

2781-514: The Greek government-debt crisis , Greek debt is given a waiver under the PEPP so that it could be purchased by the ECB under this programme. This waiver was given based on several considerations from the ECB: there was a need to alleviate the pressures stemming from the pandemic on the Greek financial markets; Greece was already and would be closely monitored by giving the waiver; and Greece regained market access. This proved to be controversial, as Greece

2884-648: The International Monetary Fund in July 2019 and formally took over the ECB's presidency on 1 November 2019. Lagarde immediately signalled a change of style in the ECB's leadership. She embarked the ECB on a strategic review of the ECB's monetary policy strategy, an exercise the ECB had not done for 17 years. As part of this exercise, Lagarde committed the ECB to look into how monetary policy could contribute to address climate change , and promised that "no stone would be left unturned." The ECB president also adopted

2987-596: The Netherlands had minted a commemorative issue and the first eurozone-wide commemorative coin was issued to celebrate 50 years of the Treaty of Rome . In 2009, the second eurozone-wide issue of a 2-euro commemorative coin was issued, celebrating ten years of the Economic and Monetary Union (EMU). In 2012, the third eurozone-wide issue of a 2-euro commemorative coin was issued, celebrating 10 years of euro coins and notes . Cyprus did not independently issue

3090-763: The TARGET2 payments system. The ECB was established by the Treaty of Amsterdam in May 1999 with the purpose of guaranteeing and maintaining price stability . On 1 December 2009, the Treaty of Lisbon became effective and the bank gained the official status of an EU institution . When the ECB was created, it covered a Eurozone of eleven members. Since then, Greece joined in January 2001, Slovenia in January 2007, Cyprus and Malta in January 2008, Slovakia in January 2009, Estonia in January 2011, Latvia in January 2014, Lithuania in January 2015 and Croatia in January 2023. The current President of

3193-549: The Vatican City show the map if minted in 2008 or later. The common side was designed by Luc Luycx of the Royal Belgian Mint . They symbolise the unity of the EU. The national sides were designed by the national central banks of the Eurosystem in separate competitions. There are specifications which apply to all coins such as the requirement of including twelve stars . National designs were not allowed to change until

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3296-457: The WHO declared Europe the centre of the pandemic. By March 17, a week after the press conference given by Ms. Lagarde, stock index plateaued while the interest rate spread kept on rising over 2.8%. Euro coins The coins, and various commemorative coins , are minted at numerous national mints across the European Union to strict national quotas. Obverse designs are chosen nationally, while

3399-604: The APP. The flexibility to deviate from the capital key is key for the PEPP: because of the uncertainty caused by COVID-19 it was needed to prevent tightening financial conditions. They prevent yield spreads between the bonds of different member states, caused by the flight-to-safety of investors. The flexibility in asset purchases allows for fluctuations in the distribution of purchases across asset classes and among jurisdictions to prevent market fragmentation. Following this strategy,

3502-534: The ECB is Christine Lagarde . Seated in Frankfurt, Germany, the bank formerly occupied the Eurotower prior to the construction of its new seat. The ECB is directly governed by European Union law . Its capital stock, worth €11 billion, is owned by all 27 central banks of the EU member states as shareholders . The initial capital allocation key was determined in 1998 on the basis of the states' population and GDP, but

3605-560: The ECB President Jean-Claude Trichet sent two secret letters to the Irish finance Minister which essentially informed the Irish government of the possible suspension of ELA's credit lines, unless the government requested a financial assistance programme to the Eurogroup under the condition of further reforms and fiscal consolidation. In addition, the ECB insisted that no debt restructuring (or bail-in ) should be applied to

3708-446: The ECB announced an extension of those programmes within a full-fledge " quantitative easing " programme which also included sovereign bonds, to the tune of 60 billion euros per month up until at least September 2016. The programme was started on 9 March 2015. On 8 June 2016, the ECB added corporate bonds to its asset purchases portfolio with the launch of the corporate sector purchase programme (CSPP). Under this programme, it conducted

3811-661: The ECB came into existence, the French government wanted Jean-Claude Trichet , former head of the French central bank , to be the ECB's first president. The French argued that since the ECB was to be located in Germany, its president should be French. This was opposed by the German, Dutch and Belgian governments who saw Duisenberg as a guarantor of a strong euro. Tensions were abated by a gentleman's agreement in which Duisenberg would stand down before

3914-528: The ECB from implementing quantitative easing like the Federal Reserve and the Bank of England did as soon as 2008, which played an important role in stabilizing markets. Secondly, a decision by the ECB made in 2005 introduced a minimum credit rating (BBB-) for all Eurozone sovereign bonds to be eligible as collateral to the ECB's open market operations. This meant that if a private rating agencies were to downgrade

4017-455: The ECB made substantial profits out of SMP, which were largely redistributed to Eurozone countries. In 2013, the Eurogroup decided to refund those profits to Greece, however, the payments were suspended from 2014 until 2017 over the conflict between Yanis Varoufakis and ministers of the Eurogroup. In 2018, profits refunds were reinstalled by the Eurogroup. However, several NGOs complained that

4120-418: The ECB raised interest rates for the first time since 2008 from 1% to 1.25%, with a further increase to 1.50% in July 2011. However, in 2012–2013 the ECB sharply lowered interest rates to encourage economic growth, reaching the historically low 0.25% in November 2013. Soon after the rates were cut to 0.15%, then on 4 September 2014 the central bank reduced the rates by two-thirds from 0.15% to 0.05%. Recently,

4223-559: The ECB to instigate targeted long term refinancing operations (TLTROs), first in September and later in December 2014. These complementary programs imposed conditionality on the LTROs. The TLTROs provided low cost financing to participating banks, under the condition that they reached certain targets in terms of lending to firms and households. The participating banks were thus more incited to lend to

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4326-535: The ECB. This change in leadership also marks the start of a new era under which the ECB will become more and more interventionist and eventually ended the Eurozone sovereign debt crisis . Draghi's presidency started with the impressive launch of a new round of 1% interest loans with a term of three years (36 months) – the Long-term Refinancing operations (LTRO) . Under this programme, 523 Banks tapped as much as €489.2 bn (US$ 640 bn). Observers were surprised by

4429-812: The ESCB makes provision for the following measures to ensure security of tenure for NCB governors and members of the Executive Board: The ESCB is composed of the European Central Bank and the national central banks of all 27 member states of the EU. The first section of the following list lists member states and their central banks that form the Eurosystem (plus the ECB), which set eurozone monetary policy. The second section lists member states and their central banks that maintain separate currencies. European Central Bank The European Central Bank ( ECB )

4532-543: The EU leaders decision of 10 May to establish the European Financial Stabilisation mechanism, which would serve as a crisis fighting fund to safeguard the euro area from future sovereign debt crisis. Although at first limited to the debt of Greece, Ireland and Portugal, the bulk of the ECB's bond buying eventually consisted of Spanish and Italian debt. These purchases were intended to dampen international speculation against stressed countries, and thus avoid

4635-419: The EU, Monaco , San Marino , and the Vatican City (and Andorra since 2014) also have euro coins featuring a national side, but a considerable number of these coins were not put into general circulation by the authorities who instead sold them to collectors for prices higher than their face value. Due to this, in 2012, a European Regulation established that: "A minor proportion, not exceeding 5 % of

4738-472: The Eurozone's financial institutions. Further, these operations were devoid of monitoring from the ECB regarding the use made of these liquidities and it appeared that banks had significantly used these funds to pursue carry-trade strategies, purchasing sovereign bonds with higher rates and corresponding maturity to generate profits, instead of increasing private lending. These critics and deficiencies brought

4841-461: The Governing Council announced firstly to provide immediate liquidity through conducting additional LTROs; secondly, to provide more favorable terms on the TLTRO III operations outstanding in the period between June 2020 and June 2021; and thirdly, to announce an additional package of net asset purchases of €120 billion by the end of 2020 under the already existing APP. A day later, on 13 March 2020,

4944-907: The Governing Council of the ECB (i.e., the Council of the European Monetary Institute (EMI) for the first appointments). The main responsibilities of the executive board are: The General Council comprises the President and the Vice-President and the governors of the NCBs of all 27 member states. The General Council performs the tasks which the ECB took over from the EMI and which, owing to the derogation of one or more member states, still have to be performed in Stage Three of Economic and Monetary Union (EMU). The General Council also contributes to: The Statute of

5047-453: The PEPP distributed the money among countries in need. The APP follows the capital key strategy, from which no deviations are possible. This makes the APP not able to counter the crisis effectively. Margrethe Vestager , European Commissioner for Competition argued "We will need to distribute in order to recover together. These increasing asymmetries will otherwise fragment the single market to

5150-510: The President, the Vice-President and four other members, all chosen from among persons of recognized standing and professional experience in monetary or banking matters. They are appointed by common accord of the governments of the member states at the level of the Heads of State or Government, on a recommendation from the Council of Ministers after it has consulted the European Parliament and

5253-518: The adherence by the benefitting country to an adjustment programme to the ESM. The program was adopted with near unanimity, the Bundesbank president Jens Weidmann being the sole member of the ECB's Governing Council to vote against it. Even if OMT was never actually implemented until today, it made the "Whatever it takes" pledge credible and significantly contributed to stabilizing financial markets and ending

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5356-414: The amount of nickel allowed under the EU nickel directive. The obverse side varies from state to state, with each member allowed to choose its own design. Each of the eight coins can have the same design (such as Irish coins ), or can vary from coin to coin (such as Italian coins ). In monarchies, the national side usually features a portrait of the country's monarch, often in a design carried over from

5459-400: The capital key has been readjusted since. Shares in the ECB are not transferable and cannot be used as collateral. The European Central Bank is the de facto successor of the European Monetary Institute (EMI). The EMI was established at the start of the second stage of the EU's Economic and Monetary Union (EMU) to handle the transitional issues of states adopting the euro and prepare for

5562-457: The capital key meant that the ECB could especially prevent the rise of Italian and Spanish yield spreads. Assets meeting the eligibility criteria of the APP were also eligible under the PEPP. However, the PEPP complemented the APP eligibility framework given the specificity of the PEPP-context of crisis requiring a more tailored response. Among the distinctions is that for the first time since

5665-503: The capital key strategy followed by the APP. Second, the PEPP-envelope does not need to be used in full. The PEPP is established as a separate purchase programme from and in addition to the APP with the sole purpose to respond to the economic and financial consequences of the COVID-19 crisis. Following Philip R. Lane , chief economist of the ECB, the PEPP plays a dual role in the COVID-19 crisis: (i) ensuring price stability and at

5768-429: The creation of the ECB and European System of Central Banks (ESCB). The EMI itself took over from the earlier European Monetary Cooperation Fund (EMCF). The ECB formally replaced the EMI on 1 June 1998 by virtue of the Treaty on European Union (TEU, Treaty of Maastricht), however it did not exercise its full powers until the introduction of the euro on 1 January 1999, signalling the third stage of EMU. The bank

5871-537: The cumulated total net value and volume of circulation coins issued by a Member State, taking into account only years with positive net issuance, may be put on the market above face value if justified by the special quality of the coin, a special packaging or any additional services provided". No territories associated with eurozone countries issue their own euro coins. France and the Netherlands have overseas regions with their own currencies. As of 2023, 24 countries issue euro coins with their own national sides, for

5974-517: The date of introduction of the euro in Bulgaria. There are eight different denominations of euro coins: €0.01, €0.02, €0.05, €0.10, €0.20, €0.50, €1.00 and €2.00 The €0.01, €0.02 and €0.05  coins show Europe in relation to Asia and Africa in the world. The remaining coins show the EU before its enlargement in May 2004 if minted before 1 January 2007, a map of Europe if minted after. Coins from Austria , Italy , San Marino , Portugal and

6077-412: The decision-making with regard to the single monetary policy for the eurozone and the implementation of such decisions. The Governing Council comprises all the members of the executive board and the governors of the NCBs of the member states without a derogation , that is, those countries which have adopted the euro. The main responsibilities of the Governing Council are: The executive board comprises

6180-465: The design of the coins. The state issuing a coin should in some way clearly be identified on the obverse side, either by stating the full name or a clearly identifiable abbreviation of it; and neither name nor the denomination of the coin should be repeated on the obverse, as it is already featured on the common reverse side. These restrictions do not apply retroactively; only new designs—the national obverse sides for regular issues of states newly joining

6283-595: The design of the national sides was changed, and have until June 20, 2062 in the event that the design had not been changed before. Finally, the different States must inform each other of their new draft designs (both of "regular" and 2 euro commemorative coins), as well as the European Council and the European Commission, which must give its approval. In one example, the initial design of Andorran 10, 20 and 50 cent coins did not obtain EU approval because

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6386-474: The design. However, Belgium did issue a 2.50 euro collector's coin, taking advantage of the fact that these coins are not submitted to the draft design approval. Euro coins have high-security machine-readable features. Sophisticated bi-metal and sandwich technologies have been put into the €1 and €2 coins. The 10c, 20c and 50c coins are made of Nordic gold , which is a unique alloy, difficult to melt and used exclusively for coins. The lettering on

6489-444: The edge of the €2 coin also protects it from counterfeiting. Euro coins were designed in cooperation with organisations representing blind people, and as a result incorporate many features allowing them to be distinguished by touch alone. In addition, their visual appearance is designed to make them easy to tell apart for persons who cannot read the inscriptions on the coins. The coins increase in size and weight with value. Of

6592-594: The eight denominations of euro coins, the three lowest denominations are small, resemble copper in colour and are quite thin and light. The next three denominations resemble gold in colour and are thicker as well as heavier. The highest two denominations are bimetallic, being generally larger and thicker than the lower denominations. In general, the greater the value, the heavier and larger the coin. Copper colour identifies low value; gold colour identifies medium value; two different metals identify high value. There are also differences within each group. The 2 cent coin has

6695-437: The end of 2008, unless a monarch (whose portrait usually appears on the coins) dies or abdicates. National designs have seen some changes due to a new rule stating that national designs should include the name of the issuing country. The common side of the €0.01, €0.02 and €0.05 coins depict the denomination, the words 'EURO CENT' beside it, twelve stars and Europe highlighted on a globe in relation to Asia and Africa in

6798-449: The end of his mandate, to be replaced by Trichet. Trichet replaced Duisenberg as president in November 2003. Until 2007, the ECB had very successfully managed to maintain inflation close but below 2%. The European Central Bank underwent through a deep internal transformation as it faced the global financial crisis and the Eurozone debt crisis . The so-called European debt crisis began after Greece's new elected government uncovered

6901-435: The euro or of eurozone states which change their design, and €2 commemorative coins issued from 2006 onwards—are subject to them. However, the five countries whose designs violated the first update to the rules ( Austria , Belgium , Finland , Germany and Greece ) initially were assumed to have to change their design in the future, which Finland did for 2007 and Belgium for 2008. In 2008, another recommendation changed

7004-401: The euro was the first to have authorities consult organizations representing the blind and visually impaired before the release of the currency. Each state may also mint two 2 euro commemorative coins each year from June 2012. From 2004 to May 2012, countries were only allowed to mint one coin per year. Only €2 coins may be used in this way (for them to be legal tender) and there is

7107-507: The fear that after the COVID-19 crisis was over, the stronger economies would emerge even stronger, while the weak economies would get even weaker. Thanks to the more stringent banking regulations implemented after the Global Financial Crisis, a financial crisis was avoided as banks could cope better with the crisis and complementary measures were taken by the EU and national governments. The Pandemic Asset Purchase Programme (PEPP)

7210-520: The first three months of 2012. Facing renewed fears about sovereigns in the eurozone continued Mario Draghi made a decisive speech in London, by declaring that the ECB "...is ready to do whatever it takes to preserve the Euro. And believe me, it will be enough." In light of slow political progress on solving the eurozone crisis, Draghi's statement has been seen as a key turning point in the eurozone crisis, as it

7313-519: The former currency (e.g. Belgian coins ). Republics tend to feature national monuments, symbols, or stylised designs (such as French coins ). Engravings on the edge of the €2 coin are also subject to national choice. There are at present no plans to abolish the national designs in favour of a common European one. However, the Commission has proposed that the 1c, 2c and 5c coins have a common design to keep costs down. Though they are not members of

7416-520: The huge increase in borrowing, including the cover the cost of having guaranteed the liabilities of banks, the cost of borrowing in the private financial markets had become prohibitive for the Irish government. Although it had deferred the cash cost of recapitalising the failing Anglo Irish Bank by nationalising it and issuing it with a "promissory note" (an IOU), the Government also faced a large deficit on its non-banking activities, and it therefore turned to

7519-509: The image of the Pantokrator of San Martí de la Cortinada , included in those coins, violated the principle of religious neutrality. The image of the religious figure was eliminated in the final Andorran coin design. Another example, the 2 euro commemorative coins that Belgium planned to issue in 2015 on the 200th anniversary of the Battle of Waterloo , caused complaints by France and withdrawal of

7622-655: The interest rates were further reduced reaching 0.00%, the lowest rates on record. In a report adopted on 13 March 2014, the European Parliament criticized the "potential conflict of interest between the current role of the ECB in the Troika as 'technical advisor' and its position as a creditor of the four Member States, as well as its mandate under the Treaty". The report was led by Austrian right-wing MEP Othmar Karas and French Socialist MEP Liem Hoang Ngoc . On 1 November 2011, Mario Draghi replaced Jean-Claude Trichet as President of

7725-410: The intermediate monetary objectives and key interest rate of the EU. The ECB Executive Board enforces the policies and decisions of the Governing Council, and may direct the national central banks when doing so. The ECB has the exclusive right to authorise the issuance of euro banknotes . Member states can issue euro coins , but the volume must be approved by the ECB beforehand. The bank also operates

7828-470: The left, the currency, map of Europe and twelve stars on the right. Similarly, coins minted from 1999 to 2006 depicted the EU15, rather than the whole European continent, which is on coins minted from 2007. The 1c, 2c and 5c coins, however, keep their old design, showing a geographical map of Europe with the 15 member states of 2002 raised somewhat above the rest of the map. (1999-2007) All coins have

7931-564: The national obverse sides may be varied. Also, the standard national obverse sides per se should not be changed before 2008 at the earliest, unless the head of state depicted on some coins changes before then. (This clause already came into effect for Monaco and the Vatican City, whose heads of state — Rainier III and Pope John Paul II respectively—died in 2005 and whose national obverse sides were changed for 2006). In 2005, another recommendation added two more guidelines regarding

8034-534: The nationalized banks' bondholders, a measure which could have saved Ireland 8 billion euros. During 2012, the ECB pressed for an early end to the ELA, and this situation was resolved with the liquidation of the successor institution IBRC in February 2013. The promissory note was exchanged for much longer term marketable floating rate notes which were disposed of by the Central Bank over the following decade. In April 2011,

8137-494: The net purchase of corporate bonds until January 2019 to reach about €177 billion. While the programme was halted for 11 months in January 2019, the ECB restarted net purchases in November 2019. As of 2021, the size of the ECB's quantitative easing programme had reached 2947 billion euros. The long term refinancing operations (LTRO) are regular open market operations providing financing to credit institutions for periods up to four years. They aim at favoring lending conditions to

8240-399: The new design if minted 2008 or later. The coins symbolise the unity of the EU. On 2005 June 7, the European Council decided that the common side of the 10 euro cent to €2 coins should be brought up to date to reflect the enlargement of the EU in 2004 . The 1c, 2c and 5c coins show Europe in relation to the rest of the world, therefore they remained unchanged. In 2007, the new design

8343-499: The official sector for a loan to bridge the shortfall until its finances were credibly back on a sustainable footing. Meanwhile, Anglo used the promissory note as collateral for its emergency loan (ELA) from the Central Bank. This enabled Anglo was able to repay its depositors and bondholders. It became clear later that the ECB played a key role in making sure the Irish government did not let Anglo default on its debts, to avoid financial instability risks. On 15 October and 6 November 2010,

8446-420: The original royal portrait of 1999, but otherwise keep the new 2008 coin design as far as the country identification and year mark are concerned. These provisions additionally prohibit further sede vacante sets of coins by the Vatican City, allowing only commemorative coins for such occasions. Finland and Spain updated their designs to meet the new rules about the stars in 2008 and 2010, respectively. In 2012,

8549-436: The private sector and more generally stimulating bank lending to the real economy, thereby fostering growth. In December 2011 and January 2012, in the aftermath of the Global Financial Crisis, the ECB implemented two LTROs, injecting over €1000 billion of liquidity in the Eurozone financial system. They were later criticized for their inability to revive growth and to help truly revive the real economy, despite having stabilized

8652-529: The real economy, stemming from measures implemented to mitigate the public health emergency, distinct from the internal financial origins of the preceding crisis that transposed repercussions onto the real economy. Following the measures implemented by all governments to counter the spread of COVID-19 across Europe, investors fled to safety, which caused the risk of fire sales in asset markets, illiquidity spirals , credit spikes and discontinuities associated with market freezes. The flight-to-safety also encouraged

8755-492: The real economy. A third wave of TLTRO's was announced on 7 March 2019, namely the TLTRO III. Under TLTRO III, the interest rate was set at -0.5% below the deposit facility rate (DFR), under condition that banks reached a specific lending performance threshold. The TLTRO III programme was successful to stimulate credit growth. In July 2019, EU leaders nominated Christine Lagarde to replace Mario Draghi as ECB President. Lagarde resigned from her position as managing director of

8858-469: The real level indebtedness and budget deficit and warned EU institutions of the imminent danger of a Greek sovereign default . Foreseeing a possible sovereign default in the eurozone, the general public, international and European institutions, and the financial community reassessed the economic situation and creditworthiness of some Eurozone member states. Consequently, sovereign bonds yields of several Eurozone countries started to rise sharply. This provoked

8961-483: The reverse and the currency as a whole is managed by the European Central Bank (ECB). The euro came into existence on 1 January 1999. It had been a goal of the European Union (EU) and its predecessors since the 1960s. The Maastricht Treaty entered into force in 1993 with the goal of creating economic and monetary union by 1999 for all EU states except the United Kingdom and Denmark (even though Denmark has

9064-443: The rule of the stars. Finally, Austria must eliminate the denominations on the national side of their euro coins. Bear in mind that the foregoing refers to "regular" coins since, in the case of the 2 euro commemorative coins , the aforementioned is fulfilled in all coins since 2013. This is due to the fact that each one of these coins supposes a variation in the design, while, as mentioned, "regular" coins were not affected unless

9167-407: The rules again: Finland and Belgium had already corrected their design on the coins issued to include the initials of the country in 2007 and 2008, respectively. Belgium was forced to change its design back to show the original portrait of its monarch, because the 2008 update to follow the recommendations also updated the portrait, which was against the rules. The Belgian coins from 2009 onwards show

9270-524: The same levels as during the European debt crisis . It is a quantitative easing unconventional monetary policy, based on the principles of the Asset Purchases Program (APP) which is a similar programme established by the ECB in mid-2014. Asset purchase programmes are intended to bring down risk premia or term premia. However, the PEPP is not entirely the same as the APP, as it can deviate from

9373-422: The same time (ii) stabilizing the market using the flexibility of the programme to prevent market fragmentation. National central banks are the main purchasers of the bonds under the principle of risk sharing: private bonds fall completely under the risk of national central banks, while only 20% of public bonds are subject to risk sharing. These purchases under the PEPP eventually follow the capital key used in

9476-401: The signing of the Treaty, only differing in the name of the issuing country and language of the text. This was also the case in 2009, in commemoration of the tenth anniversary of the Economic and Monetary Union . The design was selected by electronic voting by EU citizens. In 2012, a common commemorative coin was issued to commemorate the tenth anniversary of euro coins and banknotes . In 2015,

9579-496: The sovereign debt crisis was almost solved by 2014, the ECB started to face a repeated decline in the Eurozone inflation rate, indicating that the economy was going towards a deflation. Responding to this threat, the ECB announced on 4 September 2014 the launch of two bond buying purchases programmes: the Covered Bond Purchasing Programme (CBPP3) and Asset-Backed Securities Programme (ABSPP). On 22 January 2015,

9682-462: The sovereign debt crisis. According to various sources, the OMT programme and "whatever it takes" speeches were made possible because EU leaders previously agreed to build the banking union . In November 2014, the bank moved into its new premises , while the Eurotower building was dedicated to hosting the newly established supervisory activities of the ECB under European Banking Supervision . Although

9785-467: The volume of loans made when it was implemented. By far biggest amount of €325bn was tapped by banks in Greece, Ireland, Italy and Spain. Although those LTROs loans did not directly benefit EU governments, it effectively allowed banks to do a carry trade , by lending off the LTROs loans to governments with an interest margin. The operation also facilitated the rollover of €200bn of maturing bank debts in

9888-415: The world. The common side of the €0.10, €0.20 and €0.50 coins currently depict the denomination on the right, the words 'EURO CENT' underneath it, with twelve stars and the European continent on the left. Coins minted from 1999 to 2006 depicted only the EU15, rather than the entire European continent, which is on coins minted after 2007. The common side of the €1 and €2 coins depict the denomination on

9991-477: The year of minting rather than the year it was put into circulation. Researchers from the University of Zürich warned that an external ring of metal surrounding an inner pill of a different colour, as in the euro coins, can lead to the release of high levels of nickel, causing allergic reactions with people sensitive to the metal. The researchers also warned that the coins could contain between 240 and 320 times

10094-407: The €1 and €2 coins, the landmass appeared more cohesive although borders were indicated. As in current issues, all coins featured 12 stars in their design. The year featured on the coins can date back to 1999, when the currency was formally established (only Belgian , Dutch , Finnish , French and Spanish coins were struck with the 1999 date). These countries traditionally strike coins with

10197-495: Was immediately welcomed by European leaders, and led to a steady decline in bond yields for eurozone countries, in particular Spain, Italy and France. Following up on Draghi's speech, on 6 September 2012 the ECB announced the Outright Monetary Transactions programme (OMT). Unlike the previous SMP programme, OMT has no ex-ante time or size limit. However, the activation of the purchases remains conditioned to

10300-508: Was introduced. The design still retains all elements of the original designs, including the twelve stars , but the map of the fifteen states is replaced by one showing the whole of Europe as a continent, without borders, to stress unity. These coins were not mandatory for existing eurozone members when introduced in 2007, but became so for every member in 2008. Starting in 2017 the 1, 2, and 5 euro cent coins from individual member states have started adjusting their common side design to

10403-423: Was of little practical importance since normal monetary policy operations were ensuring unlimited supplies of liquidity at the main policy interest rate). In September 2011, ECB's Board member Jürgen Stark , resigned in protest against the "Securities Market Programme" which involved the purchase of sovereign bonds from Southern member states, a move that he considered as equivalent to monetary financing , which

10506-412: Was reluctant to intervene to calm down financial markets. Up until 6 May 2010, Trichet formally denied at several press conferences the possibility of the ECB to embark into sovereign bonds purchases, even though Greece, Ireland, Portugal, Spain and Italy faced waves of credit rating downgrades and increasing interest rate spreads. In a remarkable u-turn, the ECB announced on 10 May 2010, the launch of

10609-506: Was the final institution needed for EMU, as outlined by the EMU reports of Pierre Werner and President Jacques Delors . It was established on 1 June 1998 The first President of the Bank was Wim Duisenberg , the former president of the Dutch central bank and the European Monetary Institute . While Duisenberg had been the head of the EMI (taking over from Alexandre Lamfalussy of Belgium) just before

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