Eurosystem
Monetary authority of the eurozone
The Eurosystem is the monetary authority of the eurozone, the collective of European Union member states that have adopted the euro as their sole official currency. The European Central Bank (ECB) has, under Article 16 of its Statute, the exclusive right to authorise the issuance of euro banknotes. Member states can issue euro coins, but the amount must be authorised by the ECB beforehand.
The Eurosystem consists of the ECB and the national central banks (NCB) of the 21 member states that are part of the eurozone. The national central banks apply the monetary policy of the ECB. The primary objective of the Eurosystem is price stability. Secondary objectives are financial stability and financial integration. The mission statement of the Eurosystem says that the ECB and the national central banks jointly contribute to achieving the objectives.
The Eurosystem is independent. When performing Eurosystem-related tasks, neither the ECB, nor an NCB, nor any member of their decision-making bodies may seek or take instructions from any external body. The Community institutions and bodies and the governments of the member states may not seek to influence the members of the decision-making bodies of the ECB or of the NCBs in the performance of their tasks.
The Eurosystem is distinct from the European System of Central Banks (ESCB), which comprises the ECB and the central banks of all 27 European Union member states, including those that are not part of the eurozone.
01Functions
In accordance with the treaty establishing the European Community and the Statute of the European System of Central Banks and of the European Central Bank, the primary objective of the Eurosystem is to maintain price stability. Without prejudice to this objective, the Eurosystem supports the general economic policies in the Community and acts in accordance with the principles of an open market economy.
The basic tasks carried out by the Eurosystem are (art. 127 TFEU):
- to define and implement the common monetary policy of the eurozone
- to conduct foreign exchange operations
- to hold and manage the official foreign reserves of the euro zone Member States, and
- to promote the smooth operation of payment systems.
In addition, the Eurosystem contributes to the smooth conduct of policies pursued by the competent authorities relating to the prudential supervision of credit institutions and the stability of the financial system.
The ECB has an advisory role vis-à-vis the Community and national authorities on matters within its field of competence, particularly where Community or national legislation is concerned. The ECB, assisted by the NCBs, has the task of collecting the necessary statistical information either from the competent national authorities or directly from economic agents to enable the ESCB to perform its tasks.
02Members
03Consolidated balance sheet of the Eurosystem
| Assets | Liabilities | ||||||
|---|---|---|---|---|---|---|---|
| (EUR millions) | 31 December
2024 |
31 December
2023 |
31 December
2022 |
(EUR millions) | 31 December
2024 |
31 December
2023 |
31 December
2022 |
| 1 Gold and gold receivables | 872,156 | 649,110 | 592,898 | 1 Banknotes in circulation | 1,588,344 | 1,567,711 | 1,572,033 |
| 2 Claims on non-euro area residents denominated in foreign currency | 522,440 | 499,583 | 523,240 | 2 Liabilities to euro area credit institutions related to monetary policy operations denominated in euro | 2,991,283 | 3,508,865 | 3,998,940 |
| 3 Claims on euro area residents denominated in foreign currency | 16,015 | 13,876 | 20,417 | 3 Other liabilities to euro area credit institutions denominated in euro | 27,869 | 58,873 | 78,335 |
| 4 Claims on non-euro area residents denominated in euro | 20,132 | 20,097 | 14,224 | 4 Debt certificates issued | 0 | 0 | 0 |
| 5 Lending to euro area credit institutions related to monetary policy operations denominated in euro | 34,221 | 410,290 | 1,324,347 | 5 Liabilities to other euro area residents denominated in euro | 203,849 | 303,864 | 564,582 |
| 6 Other claims on euro area credit institutions denominated in euro | 36,292 | 28,707 | 31,035 | 6 Liabilities to non-euro area residents denominated in euro | 242,367 | 281,940 | 540,725 |
| 7 Securities of euro area residents denominated in euro | 4,532,962 | 4,898,966 | 5,102,068 | 7 Liabilities to euro area residents denominated in foreign currency | 11,274 | 16,382 | 11,683 |
| 8 General government debt denominated in euro | 20,394 | 20,917 | 21,589 | 8 Liabilities to non-euro area residents denominated in foreign currency | 603 | 4,474 | 4,753 |
| 9 Other assets | 365,924 | 393,943 | 321,222 | 9 Counterpart of special drawing rights allocated by the IMF | 182,810 | 177,116 | 181,121 |
| 10 Other liabilities | 218,667 | 260,877 | 290,578 | ||||
| 11 Revaluation accounts | 872,322 | 635,144 | 588,053 | ||||
| 12 Capital and reserves | 81,148 | 120,242 | 120,237 | ||||
| Total assets | 6,420,536 | 6,935,489 | 7,951,039 | 6,420,536 | 6,935,489 | 7,951,039 | |
Sources and credits
This article is adapted from the Wikipedia article “Eurosystem”, written by its contributors and licensed under CC BY-SA 4.0. Fathomly has changed the layout, removed citation markers, navigation and maintenance notices, and adjusted punctuation. This adapted version is shared under the same license. For references, see the original article.
Images, from Wikimedia Commons:
- Europäische Zentralbank Frankfurt.jpg by Thomas Wolf, www.foto-tw.de, CC BY-SA 3.0 de
- Deutsche Bundesbank logo.svg by Unknown authorUnknown author, Public domain
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