IS THE EURO UNDERGOING A CRISIS?

The objective of the paper is to assess, whether there is a euro crisisunder way. A currency crisis concept - viewed as a 25% depreciation of theEUR/USD exchange rate - has been applied, together with a crisis concept asa long-term depreciation of the USD/EUR exchange rate, and finally a crisisas the impaired international role of the euro. The following are examined:share of the euro in foreign exchange reserves, importance of the euro in thefinancial markets, expansion of the euro as national currency, and applicationof the euro as reference currency within various exchange rate systems. Thepaper comes to a conclusion that neither of the aforementioned indicatorsevidences a euro crisis. However, a potential future euro crisis may beinvoked by a debt crisis within the euro area. This is preconditioned bysufficiently strong fundamental reasons for investor’s skepticism about thedebt crisis resolution and ability of the ECB to prevent the euro exchangerate depreciation