European Central Bank Essay Example | Topics and Well Written Essays - 2250 words

European Central Bank - Essay modelingIn fact, it seems that the bank has been fashioned along the lines of Bundesbank.The bank was the result of the Treaty on European Union, which is in any case referred to as Treaty of Maastricht. Despite the fact that the bank was established on June 1998, it started operating six months subsequently on 1 January 1999. This was when the euro was introduced as the bank had been set up with the euro in mind.The euro, as indicated above, came after the introduction of the European central bank. It is the official up-to-dateness that has been adopted by a total of 16 members of the European Union, out of the twenty seven that are members. The states which have adopted this currency as their official currency belong to what is referred to as the Eurozone. The countries are Austria, Belgium, and Cyprus among others. There have also been cases where the currency is used by non-member countries since its line of descent in 2004. This is with or wit hout formal agreements with the member states of the European Union. It is estimated that about 237 million Europeans are currently utilize this currency. About 175 million people have adopted euro or currencies that are pegged to this. This is especially so in Africa, where the bank has a following of over 150 million presence.For the few years that the euro and the European central bank have been in operation, their implementation can only be described as a triumph story. When the euro was introduced, many people had the impression that it is going to increase the rate of inflation. That maybe explains the discernment why some of the states were initially reluctant to adopt it. But the opposite has been achieved. The central bank, which is mandated to manage the euro for the nations that component part this currency, has been able to control the rate of inflation and maintain it at a point below only if close to two percent. The success story that is the euro and the Europea n central bank is attributable to several factors. round of them are prudent financial management and successful control of the inflation rate. Objectives of the StudyThroughout this study, the source will be guided by one study objective. That is the analysis of the factors that have led to the success of the European central bank and the euro in general. To achieve this, the writer will be guided by various specific objectives. It is through the address of these specific objectives that the writer will effectively address the major objective of the study. The specific objectives are as outlined below1. successes of the European central bank2. factors prima(p) to this success3. challenges facing the European central bank4. successes of the euro5. factors leading to this success6. challenges faced by the euro7. performance of the economy of the Eurozone Performance of the Eurozones EconomySome of the successes of both the euro and the European central bank can be reflected in th e successes of the economies of the Eurozones. Tumpel (2009) is of the view that there have been palpable changes in the economy of these nations as soon as they adopt the euro and come under the jurisdiction of the European central bank. One of the areas that these economies have excelled in is the world of employment (Noyer, 2007). Over the course of the past ten years, the employment rates at these economies have increased. The value may be conceptualised as a reflection of the progress that has been made as far