Euro banknotes and coins: five years in our life

Five years after they were first brought into circulation, euro banknotes and coins are a well-established and familiar part of daily life for euro-area residents. The total value of banknotes in circulation has almost tripled since the changeover, from €221 billon in January 2002 to €595 billion in October 2006. The increase in coins is more moderate, from €13.0 billion to €17.6 billion, a Commission Communication on Five Years of Euro Banknotes and Coins shows.

Euro banknotes, and to a lesser extent euro coins, are also widely used by the outside world: 10 to 20 % of the total value of banknotes in circulation are used outside the euro area, according to the ECB. The euro is also the official currency of Monaco, San Marino and the Vatican City. Finally, its use as a parallel currency for international payment transactions, for savings purposes or simply as payment in tourist areas throughout the world is also increasing.

Recent Eurobarometer surveys show that people’s mental changeover to the euro has been a gradual process. While 57 % of respondents say they calculate in euros for common day-to-day purchases, 22 % still count in the old currency (and 21 % say they use either). For occasional, expensive purchases, the most common of which are a home and a car, people still regularly revert to the old currency (40 %), though the euro is progressively becoming a benchmark currency for these infrequent purchases as well.

The surveys also show that although a clear majority (68 %) is happy with the single currency, there remains a lingering but distinct feeling that it has increased prices, a perception which is clearly not borne out by the facts since inflation has stood at only slightly above 2%. This distorted perception can be explained by the bad impression caused by some abuses in certain sectors and certain countries around the changeover in 2002 and the generally observed psychological tendency to note price increases more readily than price decreases (which have occurred, for example, in electronic and IT consumer goods and telecoms services). The good news, however, is that the gap between real and perceived inflation is progressively closing.

It is also striking that some advantages of the euro are unknown to a large majority of citizens. Only a quarter are aware that there are no extra costs or charges when withdrawing money with a bank card in another EU country (23 %) or paying with a bank card (27 %), while even fewer (16%) are aware that there are no extra costs or charges for executing a bank transfer.

Further information: Eurobarometer