European Monetary System

The European Monetary System (EMS), established in 1979, was an arrangement among European countries to stabilize exchange rates and promote monetary stability before the Euro's introduction. It aimed to reduce currency fluctuations by linking member currencies through the Exchange Rate Mechanism (ERM), encouraging cooperation and discipline in monetary policy. By maintaining more stable currency values, the EMS helped facilitate trade and economic integration within Europe. It served as a foundational step toward the creation of the Euro, which eventually replaced individual national currencies, fostering deeper economic unity among member states.