European Monetary System (EMS)

The European Monetary System (EMS), established in 1979, was a framework designed to stabilize currency exchange rates among European countries. It aimed to reduce fluctuations and promote economic integration by linking national currencies through fixed or semi-fixed exchange rates, maintained with the help of the Exchange Rate Mechanism (ERM). The EMS also introduced the European Currency Unit (ECU) as a basket of member currencies, eventually leading to the creation of the euro. Its goal was to foster economic stability, facilitate trade, and prepare countries for deeper monetary cooperation within the European Union.