Which European Union member has kept its own currency and maintains a fixed value against the euro?

Question

BlackTom AI · Accepted Answer

To approach this question, we first identify what it means to have one’s own currency while maintaining a fixed value against the euro. 
Option by option evaluation:
Option 1: Denmark. Denmark uses the Danish krone, which is indeed a separate currency from the euro. Denmark participates in the European Exchange Rate Mechanism II (ERM II) and maintains a fixed (or very tightly pegged) exchange rate to the euro, with the Danish central bank actively defending the peg. This matches the description of keeping its own currency while keeping a fixed value relative to the euro.
Option 2: Russia. Russia uses the ruble and does not maintain a fixed value against the euro; its exchange rate is managed but not fixed to the euro, and thus this option conflicts with the criterion of a fixed peg to the euro.
Option 3: Belgium. Belgium is a member of the euro area and uses the euro as its currency. It does not keep its own currency, so it cannot satisfy the condition of having a fixed value against the euro while keeping a separate currency.
Option 4: the United Kingdom. The UK uses the pound sterling and is not fixed to the euro; moreover, it is not part of ERM II with a fixed peg to the euro, so this option does not meet the described situation.
In summary, only Denmark fits the combination of retaining its own currency (krone) and maintaining a fixed value against the euro through ERM II interventions, while the other options either use the euro, lack a fixed peg, or do not have a separate currency compatible with the described arrangement.

01:220:300:01 INTERNATIONAL ECON Qz06: International macroeconomics and foreign exchange

Which European Union member has kept its own currency and maintains a fixed value against the euro?

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