The euro zone’s key problem: The altogether negative effect of the disappearance of currency risk

The main effect of monetary unification is to eliminate currency risk. Very positive effects are normally expected from this disappearance but, altogether, this is not the case in the euro zone: The disappearance of currency risk has accentuated the member countries’ productive specialisation, which is positive on the whole, but has also increased income heterogeneity between these countries ; It has not had the expected positive effect on trade between the euro-zone countries; It has not boosted portfolio diversification and capital mobility between the euro-zone countries .