Euro Area Nominal Effective Exchange Rate 41

In the Eurozone, the nominal effective exchange rate of the euro 41 (EER-41) is a weighted average of nominal bilateral rates between the euro and a basket of 41 foreign currencies. It is an indicator of the external values of the euro vis-à-vis the currencies of selected euro area’s trading partners. A (fixed) weighting scheme is employed in these computations. The overall trade weights underpinning the EER indices are updated every five years. The euro EER indices were first constructed in 1999 and the first update of the weights took place in 2004. If this index rate goes up, more foreign currency can be obtained, on average, for €1. It therefore becomes more expensive, on average, for those who want to exchange foreign currency for euro. Likewise, if this index rate goes down, less foreign currency can be obtained, on average, for €1 and, in turn, it becomes less expensive to exchange foreign currency into euro.