The European Currency Unit (₠ or ECU: French pronunciation: [eky], English: /eɪˈkjuː/ or spelt out /ˌiːˌsiːˈjuː/) was a basket of the currencies of the European Community The European Community was the first of the three pillars of the European Union (EU) between 1992 and 2009. Created by the Maastricht Treaty (1992), it was based upon the principle of supranationalism and had its origins in the European Economic Community, the predecessor of the European Union. The Treaty of Lisbon abolished the entire pillar member states, used as the unit of account A unit of account is a standard monetary unit of measurement of the market value/cost of goods, services, or assets. It is one of three well-known functions of money. It lends meaning to profits, losses, liability, or assets of the European Community before being replaced by the euro The euro is the official currency of the European Union (EU), and is currently in use in 16 of the 27 Member States. The states, known collectively as the Eurozone, are Austria, Belgium, Cyprus, Finland, France, Germany, Greece, the Republic of Ireland, Italy, Luxembourg, Malta, the Netherlands, Portugal, Slovakia, Slovenia and Spain. The currency on January 1, 1999, at parity. The ECU itself replaced the European Unit of Account, also at parity, on March 13, 1979. The European Exchange Rate Mechanism The European Exchange Rate Mechanism, ERM, was a system introduced by the European Community in March 1979, as part of the European Monetary System , to reduce exchange rate variability and achieve monetary stability in Europe, in preparation for Economic and Monetary Union and the introduction of a single currency, the euro, which took place on 1 attempted to minimize fluctuations between member state currencies and the ECU. The ECU was also used in some international financial transactions, where its advantage was that securities denominated in ECUs provided investors with the opportunity for foreign diversification without reliance on the currency of a single country.[2]
The ECU was conceived on 13 March 1979 as an internal accounting unit. It had the ISO 4217 currency code ISO 4217 is the international standard describing three-letter codes to define the names of currencies established by the International Organization for Standardization (ISO). The ISO 4217 code list is the established norm in banking and business all over the world for defining different currencies, and in many countries the codes for the more XEU.
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