Challenges And Opportunities Of Euro Under The New Economic Crisis

Since the beginning of 2007, sub-prime mortgage crisis has spread rapidly from a single market to multiple markets, from a single country to countries around the world, becoming the new economic crisis which causes a great impact on the international financial stability and world economic growth. As the world's second-largest economy, the world's largest trade area, Europe or the Euro area in this financial turmoil sweeping through the world can not maintain its own integrity. The French banking sector bears the brunt of it, followed by the bad news of the Germany, UK banking sectors, having huge burst losses. The investors suffered a severe blow in confidence, leading to the worsening of European stock markets. The series of large-scale cash-injection rescue act by the European Central Bank also increased the worries that investors have on the negative impact of sub-prime mortgage crisis and market value shrinking, Due to lower overseas demand, the EU's export trade was also hit severely.This thesis focuses on the challenges and opportunities that the Euro faces under the background of sub-prime mortgage crisis. It gives a brief review of the occurrence of the sub-prime crisis in the first chapter, introducing the research background, content, and framework. In the second chapter it introduces the new economic crisis and Euro, divided into four parts: the first part gives an overview of the new economic crisis, specifically including the causes, characteristics and nature of the new economic crisis, the second part deal with the Optimum Currency Areas Theory and a simple statement of the theoretical basis for the implementation of Euro, the third part describes the course of development of the European Union and Euro, the fourth part describes the status of Euro. The third chapter of the paper gives a detailed analysis of the impact of the new economic crisis on Euro. It includes its impact on the Euro-zone economy, on the Euro itself, the opportunities and challenges that Euro faces and the impending change of the world's monetary structure. Then comes the study of countermeasures of Euro under the background of. the new economic crisis, including three aspects: namely, the response of the Euro zone central bank, of the Euro area countries. In the end this paper gives the research conclusion, the shortage and the contribution of the study.