This paper explores inflation determinants within the EU and implications for new members'' euro adoption plans. Factor … analysis partitions observed inflation in EU25 countries into common-origin and country-specific (idiosyncratic) components …. Cross-country differences in common-origin inflation within the EU are found to depend on gaps in the initial price level …

This cross-country paper explains differences in external sector performance among four large euro area countries …—France, Germany, Italy, and Spain. The paper discusses that during 2001–04, the performance of the external sector differed markedly … among these four largest euro area countries. The study presented in this paper describes the evolution of the traditional …

The three-month Eurepo interest rate, the euro component of the SDR interest rate basket, will be discontinued as of … representative interest rate instrument of the euro area in the SDR interest rate basket since 2006. However, faced with a … secondary market yield curve covering euro area government bonds rated either investment grade or AA and above. In staff's view …

derogation from adopting the euro as their currency (that is, each country joining the EU commits to replace its national … currency with the euro, but can choose when to request permission to do so). For most of these countries, adopting the euro … convergence with the rest of the euro area. …

This paper focuses on euro area policies. The monetary policy stance remains appropriate for now. Fiscal policies are …