monetary unions
Shared currency agreements
A monetary union is an agreement among countries or regions to share a common currency and coordinate monetary policy under a single central authority.
The eurozone, where multiple European nations use the euro, is the most prominent contemporary example.
Member states surrender independent control over interest rates and money supply in exchange for economic integration and reduced transaction costs.
Monetary unions differ from mere currency pegs or exchange rate agreements in their depth of institutional commitment.
- EurozoneSingle-currency economic area
- common currencyMutually accepted money
- exchange ratesCurrency conversion values
- central banksGovernment monetary policy institutions
- gold standardMeasure of ultimate quality
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