Development of Nominal Convergence Indicators in New Member States of European Union under the Challenges of Economic and Financial Crisis

The importance of compliance with nominal convergence criteria is crucial for adopting the euro in New Member States (NMS). Although some of these countries have made remarkable efforts for complying with nominal criteria, structural and conjunctional macroeconomic imbalances have created big problems in this respect. Also, the global financial crisis revealed new challenges for the NSM which are not yet members of the euro area. Having imbalances widened further much more than the countries in the euro area, many of them have come to appreciate the protection of the euro area membership, especially at times of financial and economic crises. Though, some NMS would like to speed up euro adoption, they now face conditions that may make it more difficult for them to satisfy the requirements of the nominal convergence criteria. Thus, in this article we try to capture the effects of economic and financial crises on the nominal convergence indicators in NMS.