Effects of Economic and Financial Crisis on Nominal Convergence Indicators in New Member States

The importance of compliance with nominal convergence criteria is crucial for adopting the euroin New Member States (NMS). Although some of these countries have made remarkable efforts forcomplying with nominal criteria, structural and conjunctional macroeconomic imbalances have created bigproblems in this respect. Also, the global financial crisis revealed new challenges for the NSM which are notyet members of the euro area. Having imbalances widened further much more than the countries in the euroarea, many of them have come to appreciate the protection of the euro area membership, especially at times offinancial and economic crises. Though, some NMS would like to speed up euro adoption, they now faceconditions that may make it more difficult for them to satisfy the requirements of the nominal convergencecriteria. Thus, in this article we try to capture the effects of economic and financial crises on the nominalconvergence indicators in NMS.