Exchange Rate Set for Euro

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BRUSSELS, Belgium -- The European Union officially announced the 11 countries that will adopt the euro, the currency unit to be introduced in January, and set euro rates against each member's currency.

Following is a list of the participating countries and the set rate at which their currencies will be exchangedin January:

  • Austria, 13.91 schillings.
  • Belgium, 40.78 francs.
  • Finland, 6.01 marks.
  • France, 6.63 francs.
  • Germany, 1.98 marks.
  • Ireland, .8 punts.
  • Italy, 1,958 lire.
  • Luxembourg, 40.78 francs.
  • Netherlands, 2.23 guilders.
  • Portugal, 202.7 escudos.
  • Spain, 168.2 pesetas.
  • The rates above are similar to rates that had been established against the ecu, the European Currency Unit that was the predecessor to the euro.

    Rates were set now to avoid currency speculation before the euro's introduction and are expected to fluctuate very little before they are set permanently in January, economists said.

    The euro rates were established in the shadow of a showdown between France and other euro countries over who would run the central bank for the next eight years. A last-minute compromise put the bank for four years in the hands of a Dutch banker, Wim Duisenberg, to be followed by a French banker, Jean-Claude Trichet, for the next four years.

    Sarwar Kashmeri, president of Niche Systems, a New York-based firm that advises U.S. companies on the euro, said both bankers were among the most conservative in Europe and "will assure that the euro is strong to avoid further public relations problems that could weaken the monetary union."

    "The rates introduced are pretty much what everyone expected, and if unforeseen problems arise, the central bank will do everything in its power to keep the rate from fluctuating," he said.

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