Economic benefits of the euro

This section analyses how euro area Member States and their citizens have benefited from the euro since its launch more than 20 years ago and to what extent the expected benefits of its introduction have materialised. The adoption of the euro has facilitated cross-border transactions, especially in product and financial markets, thereby increasing price transparency and competition. However, barriers limiting consumer choice and full price competition, such as the incomplete Single Market, remain. Medium-term price stability across the euro area has been achieved since the launch of the euro; and increasingly integrated financial markets have also provided citizens and firms with more opportunities to share risks. At the same time, however, lower transaction costs and elimination of nominal exchange rate risk had a stronger impact on cross-border financial flows than on intra-euro trade in goods and services which led to an unsustainable accumulation of debt in some Member States in the run-up to the global financial crisis. Overall, the section concludes that the euro can only reach its full beneficial potential once the economic and monetary union (EMU) architecture is completed.