Abstract
This paper overviews the joint strategy of the Bank of Slovenia and of the Government of Slovenian for the policy management in the Exchange Rate Mechanism II (ERM II) and the eventual adoption of the euro. The current prospects of the Slovenian economy are favorable for early entry into ERM II so that the currency union can be acceded as soon as possible. The ERM II-connected risks, in particular an asymmetric credit financed demand boom, require a new policy mix to be set in place. While the monetary policy will focus on the tight management of the nominal exchange rate, the role of inflation restraint and shock absorption will rely on fiscal and income policies.
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The views expressed by the author do not necessarily correspond to those of the Board of the Bank of Slovenia. This paper was prepared for the panel “Monetary Policy and EMU Enlargement: The Adoption of the Euro” at the International Atlantic Economic Conference held in Lisbon in March 2004.
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Kozamernik, D. The ERM II issues: An interpretation of the Slovenian approach. Atlantic Economic Journal 32, 268–279 (2004). https://doi.org/10.1007/BF02304232
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DOI: https://doi.org/10.1007/BF02304232