Six months of living with the euro

Jean-Pierre Roth, Chairman of the Governing Board

Wirtschaftsforum (Economic Forum) Tuttlingen, Tuttlingen, 25 June 2002, 25.06.2002

In 1992, the then chairman of the National Bank, Markus Lusser, spoke at the Economic Forum Tuttlingen on the subject of «The monetary integration of Europe – some reflections from the Swiss vantage point». With regard to the planned monetary union, he doubted whether the member countries would actually grant the central monetary authority independence, a vital prerequisite for a stability-oriented monetary policy and, therefore, for the success of a monetary union.

Ten years on, the European monetary landscape has been transformed fundamentally. The European Central Bank enjoys an excellent reputation as an independent central bank. Within a very short time, the euro has become most significant as an investment currency, and it continues to gain ground. For half a year now – since it took physical form – it has also been legal tender in twelve EU countries.

The euro's introduction also has manifold implications for Switzerland. First of all, it has made business for Swiss companies easier. Foreign currency management has been facilitated, and the danger of currency turbulences, as witnessed under the EMS, has decreased. In Switzerland, the euro will be increasingly used as a means of payment. There is no risk, however, that it might supersede the Swiss franc. As an investment and issuing currency, the euro strengthens competition, but the Swiss franc will remain an attractive diversification currency. Last but not least, the greater price transparency in the European market brought about by the euro's launch is likely to have some influence on Switzerland's domestic economy and again raise awareness there for the necessity of structural changes.