1.5 Euro – Lithuania

In 2018, Lithuania was firmly established within the Eurozone, having adopted the euro as its official currency on January 1, 2015. This move replaced the former national currency, the litas, which had been pegged to the euro at a fixed rate of 3.4528 since 2002. By 2018, the transition was complete, with the euro deeply integrated into the financial system and daily life. The primary focus was no longer on currency adoption but on leveraging the benefits of euro membership, such as reduced transaction costs, eliminated exchange rate risk for trade with the Eurozone, and enhanced macroeconomic stability.

The economic backdrop in 2018 was positive, with Lithuania experiencing strong GDP growth (approximately 3.5% for the year) and low inflation. As part of the Eurozone, the country's monetary policy was set by the European Central Bank (ECB), which continued its accommodative stance, including historically low interest rates and a quantitative easing program. This environment supported borrowing and investment within Lithuania. However, it also meant that Vilnius had no independent monetary tools to address domestic overheating risks, relying instead on fiscal policy and macroprudential measures for economic management.

A significant legacy issue from the euro changeover was still present in 2018: the redemption of litas banknotes and coins. The Bank of Lithuania maintained an indefinite exchange period for litas, allowing residents and collectors to convert old currency at the fixed rate. This process served as a final administrative footnote to the currency transition. Overall, 2018 represented a period of normalization and consolidation, where the euro was the uncontested and stable foundation for Lithuania's growing economy within the European single market.