Euro at 20

April 25, 2019

Ewald Nowonty, Governor of the Austrian National Bank

SAIS Europe welcomed Ewald Nowonty of the Austrian National Bank for a conversation on the past and future of the euro. During his talk, Nowonty discussed the factors that led Europe to adopt a common currency, challenges in the recent past such as the global economic crisis, and how those challenges portend the future direction of the euro. He emphasized that aggregate demand management cannot rely exclusively on monetary policy; rather, he said fiscal strategies and structural reforms are also necessary for stability and economic growth in the eurozone.

While the European Central Bank (ECB) has weathered challenging times with the global financial crisis and a rapidly-changing economic landscape, in the last 10 years Europe has achieved greater price stability than ever, Nowonty said. The ECB has followed expansionary policies to overcome financial challenges and avoid deflation.

Today over 60 countries are either using the euro, link their currency to the euro, or have plans to use it, which Nowonty noted has resulted in the euro quickly rising to become one of the most important global currencies. While the financial crisis and other unexpected disturbances have presented challenges over the last 20 years, Nowonty said that overall the euro project has been successful.

The event concluded with Nowonty taking questions from the audience regarding the possibility of issuing “eurobonds” in the future, strategies for controlling deflation, and the upcoming appointment of a new ECB president.

[caption id="" align="alignnone" width="2500.0"] Pictured from left to right: Maximilian Buchleitner (MA ‘19), Christina Riegler (MAIA ‘19), Ewald Nowonty, Sabrina Zechmeister (MA ‘19), Line Relisieux (France/Austria, MAIA ‘19) and Johannes Gaechter (MA ‘19) [/caption]