The Euro as a Store of Value

Miloslav PARACKA

https://doi.org/10.53465/EDAMBA.2023.9788022551274.197-206

 

Abstract. Money has accompanied humankind throughout the long history of development and has continued to this day. This development took place along the lines of maintaining two basic functions - money as a medium of exchange and money as a store of value. The second mentioned function is in our focus because as a financial asset, money has a significant place in the structure of personal financial assets (PFA) of households. Historical experience proves that the preservation of value of money was often a challenge. Goal of this paper is to look at whether money nowadays fulfill the function of preserving values. We state hypothesis that ECB is successful in protecting the value of Euro. We gradually compare the Euro with other assets, either from the foreign exchange or the commodity market. We also observe how the value of the purchasing power of the Euro is effected by the HICP inflation index. Our results indicate that the Euro manages to keep its value in the monitored period only against the US dollar. All other observations ended with the decrease of value of the Euro. The result of the investigation is the finding that the topic of decrease of the value of Euro is relevant in the Eurozone today as well.

Keywords: Money, Value of Money, Euro

JEL classification: E21, E41, E58

Fulltext: PDF

Online publication date: 25 January 2024

ISBN: 978-80-225-5127-4

Publisher: University of Economics in Bratislava

Pages: 197-206

 

To cite this proceedings paper (STN ISO 690 and 690-2): 

PARACKA, M. 2024.The Euro as a Store of Value. In PETROVSKÁ, F. (ed.). EDAMBA 2023: Conference Proceedings. Bratislava: University of Economics in Bratislava, 2024. ISBN 978-80-225-5127-4, pp. 197-206.

https://doi.org/10.53465/EDAMBA.2023.9788022551274.197-206