But as an economic entity, the euro is now more real than the German marks or French francs that people keep in their wallets. European monetary policy and interest rates are under the control of the new European Central Bank. And when European finance ministers locked in the exchange rates between their national currencies and the euro on New Year's Eve, the old currencies became nothing more than different ways to print euros. Beginning Friday, the securities exchanges in all member countries are conducting their business in euros. All interbank transfers, even those within the same country, will be in euros.
Consumers now have the choice of keeping their bank accounts in euros or their national currencies.
During the next year, many stores and companies plan to convert credit-card and other electronic transactions into euros. As Europeans enter this new era, the ground beneath them is shifting. Economists and government officials are much more worried about an economic slowdown this year than they were just six months ago. Having argued somewhat smugly that Europe would be only mildly affected by the financial crises sweeping through Asia, Russia and Latin America, government officials now admit they are troubled. Most economists have cut their aggregate growth estimates for the 11 countries in Euroland from more than 3 percent to about 2.5 percent or lower.