2005年-ECB欧洲央行_Entry_of_the_currencies_of_Cyprus_Latvia_and_Malta_into_the_Exchange_Rate_Mechanism_II_ERM_II_3页_98kb

Box 8: Entry of the Currencies of Cyprus, Latvia and Malta into ERM II

Core Content

On 29 April 2005, the currencies of Cyprus, Latvia, and Malta were included in the Exchange Rate Mechanism II (ERM II) following mutual agreement among the euro area Member States, the President of the European Central Bank (ECB), and the relevant authorities from Denmark, Estonia, Lithuania, Slovenia, and the three requesting countries. The decision was made after a common procedure involving the European Commission and consultation with the Economic and Financial Committee.

Key Information

• Entry Date: 29 April 2005
• Effective Date of Rates: 2 May 2005
• Fluctuation Band: $\pm 15%$ for Cyprus, Latvia, and Malta
• Compulsory Intervention Rates are detailed in Table A below.

Table A: ERM II Central Rates and Compulsory Intervention Rates (as of 2 May 2005)

Currency	Upper Rate	Central Rate	Lower Rate
Danish krone (DKK)	7.62824	7.46038	7.29252
Estonian kroon (EEK)	17.9936	15.6466	13.2996
Cyprus pound (CYP)	0.673065	0.585274	0.497483
Latvian lats (LVL)	0.808225	0.702804	0.597383
Lithuanian litas (LTL)	3.97072	3.45280	2.93488
Maltese lira (MTL)	0.493695	0.429300	0.364905
Slovenian tolar (SIT)	275.586	239.640	203.694

• Denmark has a fluctuation band of $\pm 2.25%$, while the other currencies in ERM II maintain a $\pm 15%$ band.
• The Cyprus pound and Latvian lats were already unilaterally pegged to the euro before joining ERM II.
  • Cyprus had a $\pm 15%$ fluctuation band.
  • Latvia had a $\pm 1%$ fluctuation band after re-pegging from the SDR to the euro on 1 January 2005.
• The Maltese lira was previously pegged to a basket of currencies (euro, pound sterling, US dollar) with no fluctuation band. It was re-pegged to the euro upon entry into ERM II.
• All three countries have unilateral commitments to maintain their exchange rates at the central rate against the euro, with a $\pm 15%$ band for Cyprus and Malta, and $\pm 1%$ for Latvia.

Main Macroeconomic Commitments

The entry into ERM II is based on firm commitments by the respective national authorities to ensure macroeconomic stability and convergence. These commitments include:

• Fiscal discipline: Reducing public debt and controlling government expenditure.
• Inflation control: Achieving sustainable inflation reduction, particularly for Latvia.
• Current account balance: Reducing deficits and ensuring external sustainability.
• Structural reforms: Enhancing economic flexibility, productivity, and competitiveness.
• Wage and productivity alignment: Ensuring wage developments remain in line with productivity growth.
• Financial supervision: Maintaining effective oversight of the financial system to limit credit risk and promote prudent credit policies.

Table B: Main Macroeconomic Indicators (Annual Percentage Changes)

Indicator	Cyprus (2001-2003)	Cyprus (2004)	Latvia (2001-2003)	Latvia (2004)	Malta (2001-2003)	Malta (2004)
Real economic growth	2.7%	3.7%	7.3%	8.5%	-0.4%	1.5%
HICP inflation	2.9%	1.9%	2.5%	6.2%	2.3%	2.7%
Growth of credit to the private sector	7.9%	5.0%	41.6%	42.9%	3.9%	12.7%
Current account balance (% of GDP)	-3.7%	-5.8%	-7.6%	-12.4%	-3.3%	-7.1%
Fiscal deficit (% of GDP)	-4.4%	-4.2%	-2.1%	-0.8%	-7.6%	-5.2%
Government debt (% of GDP)	65.6%	71.9%	14.5%	14.4%	65.6%	75.0%
Long-term interest rate	6.0%	5.8%	6.0%	4.9%	5.7%	4.7%
Short-term interest rate	4.7%	4.7%	5.0%	4.2%	4.1%	2.9%
Exchange rate (per EUR)	0.5784	0.5818	0.5939	0.6652	0.4127	0.4280

Note: Data refer to annual averages. Sources: ECB, Eurostat, and European Commission.

Summary of Key Points

• The decision to include Cyprus, Latvia, and Malta in ERM II was based on unilateral commitments from these countries.
• ERM II fluctuation bands are set at $\pm 15%$ for Cyprus and Malta, and $\pm 1%$ for Latvia.
• The ECB is not subject to additional obligations due to these unilateral arrangements.
• Macroeconomic indicators are closely monitored to ensure convergence and stability.
• Each country has specific fiscal and structural reform commitments aimed at maintaining economic stability and supporting the euro's integration.