02374cas a2200241 a 4500 AALejournalIMF015171 230101c9999 xx r poo 0 0eng d 5.00 USD 9781484321393 1934-7685 BD-DhAAL BD-DhAAL International Monetary Fund. European Dept. Central and Eastern Europe : New Member States (NMS) Policy Forum, 2014, Selected Issues Paper. Washington, D.C. : International Monetary Fund, 2015. 1 online resource (105 pages) IMF Staff Country Reports <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students This Selected Issues Paper's objective is to illustrate economic benefits and costs from euro adoption by reviewing the main arguments and empirical evidence in Central and Eastern Europe: New Member States (NMS). The parameters of the euro adoption debate have shifted. Although countries joining the euro area in the 2000s could expect to benefit from a significant country risk premium, this premium has mostly vanished with the euro crisis. The NMS that have maintained exchange rate flexibility and monetary policy autonomy have, in general, made good use of it. During convergence, nominal currency appreciation supported more balanced growth and restrained credit and asset price booms. It is an open question whether the macroeconomic volatility of the past decade will recur. If divergent growth patterns and volatility were to repeat, euro adoption would constrain macro-policy options, especially for economies with large income gaps and asynchronized business cycles vis-a-vis the euro area. Thus, a large burden would be placed on other policy instruments to safeguard balanced growth, notably counter-cyclical fiscal policy and macro-prudential policies. Structural reforms to boost growth potential and facilitate internal adjustment would also be important. Mode of access: Internet IMF Staff Country Reports; Country Report ; No. 2015/098 Full text available on IMF http://elibrary.imf.org/view/journals/002/2015/098/002.2015.issue-098-en.xml IMF e-Library