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The expansion of the EMU: currency speculation and arbitrage

Farhad F. Ghannadian (Stetson School of Business and Economics, Mercer University, Atlanta, Georgia, USA)

European Business Review

ISSN: 0955-534X

Article publication date: 1 August 2004

Abstract

The latest European Union summit in the fall of 2002 revealed that over 11 countries (Cyprus, The Czech Republic, Estonia, Hungary, Latvia, Malta, Poland, Slovakia, Slovenia, Bulgaria, and Romania) have expressed their desire to join the European Monetary Union (EMU) and convert their currency to the “euro”. The European Commission will have to completely equalize interest rates and inflation rates of all these countries before admitting them to join the EMU or there will be arbitrage profits and currency speculation, which will slow down the growth of the overall European Community and negatively affect the value of the euro.

Keywords

Citation

Ghannadian, F.F. (2004), "The expansion of the EMU: currency speculation and arbitrage", European Business Review, Vol. 16 No. 4, pp. 398-405. https://doi.org/10.1108/09555340410547008

Publisher

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Emerald Group Publishing Limited

Copyright © 2004, Emerald Group Publishing Limited