HomeDLSU Business & Economics Reviewvol. 10 no. 2 (1998)

Estimation of An Aggregate Demandfor Money Function in the EuropeanEconomic and Monetary Union (EMU)

Victor Pontines

Discipline: Business and Economics



In May 1998, the 11 countries to comprise the EuropeanEconomic and Monetary Union (EMU) were finally selected. Theselection put an end to doubts that the EMU will come intoexistence at the end of this century. With the Union in place,fixed exchange rates or a common currency would have to beadopted, necessitating a common monetary policy. Concomitantly,the European System of Central Banks (ESCB), headed by theEuropean Central Bank (ECB), would have to choose an appropriatemonetary strategy to fulfill its objectives as laid down in Article 105of the Treaty of the European Union.