👉 The euro, as the common currency of 19 European Union member states, operates under a unique monetary framework. It is managed by the European Central Bank (ECB), which sets monetary policy for the Eurozone, focusing on price stability to ensure low and sustainable inflation. Unlike fiat currencies, the euro has a fixed exchange rate with the US dollar, meaning it cannot be freely traded against other currencies. Instead, transactions are settled in euros, and its value is determined by market forces of supply and demand. Euros can be exchanged for other currencies at the rates set by banks or through central bank interventions, but these rates are not directly controlled by individual countries. The euro's introduction in 1999 as an electronic currency and its physical form in 2002 marked a significant step towards economic integration within Europe, aiming to simplify trade and reduce transaction costs among member states.
