Abstract

On the Problems of narrowing the Exchange Rate Margins within the EEC

On April 24, 1972 the proposal to narrow the cross rates of the EEC currencies to a margin of +2,25 Y% has been enforced as a first step towards an EEC currency union. After a short survey of the genesis of the proposal (I.) the technical details of it are presented and compared with alternative solutions for narrowing the band of the cross rates (II. and III.). In section IV. the following questions are discussed: Does the new regulation for the EEC cross rates really lead the EEC countries towards monetary union? Can it contribute to lessening the dependence of the EEC-countries’ monetary policy from the monetary conditions in third countries, especially in the United States? The answers are rather negative for the new regulations affect important fields of national policy and could make clear conflicts between the EEC members which until now have been hidden