Smooth Debut Boosts Euro on World Markets

“Europhoria” swept the European public and currency markets Wednesday as traders saluted the largely flawless new year’s launch of euro notes and coins by boosting the currency’s value against the dollar.

Commuters and shoppers mostly shrugged off the inevitable confusion and queues when more than 300 million Europeans in 12 nations began using their common currency on the first working day of the year.

There were big crushes in German and Dutch banks as customers braved freezing weather to trade in old marks and guilders, even though national currencies can be used for two more months.

“People are coming in, emptying their wallets onto the table and saying, ‘I want euros,’” said Oliver Froehlich, euro-transition leader at the Frankfurter Volksbank.

There also were some first euro robberies to report: A gunman in Athens made off with nearly $70,000 worth of the new bills from a post office. In Ireland, police said three robbers threatened staff at a bank branch before grabbing about $1,800 worth of euros from a till and escaping in a waiting car.

The euro, launched three years ago initially for electronic transactions, had mostly declined in value since. It first began trading at a value of $1.17, but fell below 83 cents by October 2000. On Wednesday, however, the currency’s value jumped to 90.4 cents in New York from 89.1 cents Monday.

The euro also appreciated Wednesday against the British pound and the Japanese yen, in what one banker called a “relief rally” after forecasts of chaos proved unfounded.

Top retailers across Europe reported a smooth day’s trading but there were some hitches. Travel agents in Italy were unable to issue train tickets because of a software conversion problem. About 150 Dutch post offices had to remain closed for similar reasons.

European Monetary Affairs Commissioner Pedro Solbes said he was “extremely satisfied” with the efficiency of the changeover, billed as the biggest peacetime logistical exercise in history.

About 80% of cash dispensers in the euro area already had been converted and more than half of all transactions should be in euros by the end of the week, Solbes said.

Early-morning travelers faced some delays due to the unfamiliarity of the new coinage. Bottlenecks were reported at highway toll gates around Rome and Paris and in Greece as motorists struggled with change.

Many drivers and shoppers tried to pay for small purchases with old large-denomination notes to get change in euros.

Still, newspapers hailed a remarkably smooth start to the biggest monetary switch in history. “Euro without a hitch,” declared France’s Liberation daily on its front page.

Germany’s mass circulation Bild, once a standard-bearer of deutschemark patriotism, enthused: “We are sharing this feeling of a euro birth with 300 million Europeans. Forget yesterday. Look bravely to tomorrow. Let’s all start afresh!”

By eliminating currency risk and creating price transparency in their single market, euro states hope to make their economies more competitive and encourage trade, travel and investment.

The 12 nations that have adopted the euro are Germany, France, Italy, Austria, Portugal, Spain, Finland, Ireland, Greece, Belgium, the Netherlands and Luxembourg.

Britain, Sweden and Denmark are keeping their own currencies for now.

The next major hurdle for the new currency will be on Saturday, traditionally the biggest shopping day of the week in Europe.