The risks associated with the “Danish scenario” for the participation of the Czech koruna in the ERM II

Result code in IS VaVaI

<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F26138077%3A_____%2F18%3A%230000912" target="_blank" >RIV/26138077:_____/18:#0000912 - isvavai.cz</a>

Result on the web

<a href="https://www.slu.cz/opf/cz/struktura/katedry/katedra-ekonomie-a-verejne-spravy/konference-kek-2018/sbornik-1/" target="_blank" >https://www.slu.cz/opf/cz/struktura/katedry/katedra-ekonomie-a-verejne-spravy/konference-kek-2018/sbornik-1/</a>

DOI - Digital Object Identifier

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Result language

angličtina

Original language name

The risks associated with the “Danish scenario” for the participation of the Czech koruna in the ERM II

Original language description

The strategy for the adoption of the euro in the Czech Republic involves the entry of the Czech koruna into the ERM II mechanism for only the essential amount of time (approximately 2,5 years). No date has yet been set for the introduction of the euro. The situation may, however, arise where it will be desirable to introduce the euro as soon as possible. It would therefore be advisable to enter the ERM II even without a set date for the introduction of the euro (a so-called “technical entry” to the ERM II; “the Danish scenario” for entry into the ERM II). However, participation in the ERM II mechanism means fixing the exchange rate, which is associated with the risk of speculative attacks. The aim of this paper is to assess the experiences of those countries, whose currencies have been in ERM II for a longer period of time. The currencies exchange rates of Denmark, Lithuania, Latvia and Estonia were stable at the time of their participation in the ERM II, even in the crisis years of 2007-2009. The exchange rate stability criterion would be met in its hypothetical assessment. The key condition for this stability is the conviction of the participants in the foreign exchange markets with regard to the determination of the central bank to keep the exchange rate within the ERM II and sufficiently high foreign exchange reserves of the central bank.

Czech name

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Czech description

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Type

D - Article in proceedings

CEP classification

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OECD FORD branch

50206 - Finance

Project

<a href="/en/project/GA16-21506S" target="_blank" >GA16-21506S: New Sources of Systemic Risk in the Financial Markets</a><br>

Continuities

P - Projekt vyzkumu a vyvoje financovany z verejnych zdroju (s odkazem do CEP)

Publication year

2018

Confidentiality

S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů

Article name in the collection

Proceedings of 16th International Conference “Economic Policy in the European Union Member Countries”

ISBN

9788075102898

ISSN

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e-ISSN

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Number of pages

11

Pages from-to

139-149

Publisher name

Silesian University in Opava, School of Business Administration in Karvina

Place of publication

Karviná

Event location

Čeladná

Event date

Jan 1, 2018

Type of event by nationality

EUR - Evropská akce

UT code for WoS article

000485363200016