Ekuosian Monetary Unit
|Ekuosian Monetary Unit|
The symbol commonly used to represent the Ekuo is an "E" in Letsic script
|Date of introduction||15 August 1987|
|Pegged by||All currencies in the Ekuosian Union|
The Ekuosian Monetary Unit, colloquially known as the Ekuo, is a digital fiat currency and unit of account used in the Ekuosian Union. Its value is determined via a basket of currencies. No banknotes nor coins exist that can be used for everyday transactions; instead, the Ekuo is primarily used for virtual transactions, for banking, and for international trade. The value of the Ekuo was originally based upon the similar values of the Lestzi, Barradiwan and Neviran currencies: 1 Ekuo is currently worth approximately 0.742 USD.
The Ekuo is used in financial transactions, both within the Ekuosian Union and internationally. However, the Ekuo is not meant for everyday use, and members of the Ekuosian Union continue to use their own local currencies, pegged to the Ekuo.
Basket of currencies
The value of the Ekuo is determined as a weighted average of the 8 currencies within the Ekuosian basket. In order from most weighted to least weighted:
- 1 Lestzi Lixé (LLX) ~30%
- 1 Barradiwan Lesá (BRD) ~20%
- 0.70 Veridian Verti (VVT) ~16%
- 1 Neviran ??? (NV?) ~15%
- 0.50 Algazi Wadh (AGW) ~10%
- ? Tabiqan Mahri (TAM) ~7.5%
- 0.50 Kedrosi ??? (KD?) ~1%
- 200 Azri Yeso (AYS) ~0.5%
Apart from these eight, all other currencies in the Ekuosian Union are pegged to the Ekuo.
Exchange Rate Mechanism
The Ekuosian Exchange Rate Mechanism is a system which attempts to reduce exchange rate variability and achieve monetary stability between currencies in the Ekuosian basket. It is based on the concept of fixed currency exchange rate margins, but with exchange rates variable within those margins. This is also known as a semi-pegged system. Exchange rates are based on the Ekuo.
Future of the Ekuo
It has long been the ultimate goal of the Ekuosian Union to introduce a single common currency]. However, some political groups in Ekuosia oppose this proposal.[who?]
In Cerman, the Ekuo is the sole legal tender, and the physical Cermani Jikow is issued by commercial banks as promissory currency only. These banks are required to hold sums of EMU equivalent to the total value of currency that they issue. Many Ekuosian economists posit this system as the future of the Ekuo.