This study has been conducted to investigate whether uncertainty or fluctuations in euro exchange rate affect the macroeconomic variables in 18 Eurozone sample Countries including ; Austria, Belgium, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Portugal, Slovakia, Slovenia and Spain for the quarterly or season period of 1999 to 2014. There are huge numbers of macroeconomic variables, but out of these four variables that is, Government bond, Inflation rate, Unemployment rate and Gross Domestic Product (GDP) have been included in this study. These variables have been taken as an independent variables and euro exchange rate has been selected as a dependent variable. GARCH model has been applied in this research to calculate Ordinary Least Square regression for individual country and the Panel data technique for all countries used to investigate the relationship between dependent and independent variables.

CONTENTS
ABSTRACT iii
ACKNOWLEDGEMENT iv
CONTENTS vi
LIST OF TABLES viii
LIST OF FIGURES ix
CHAPTER ONE INTRODUCTION 1
1.1 Research background 1
1.1.1 Euro Dollar History 1
1.1.2 An Overview of Eurozone Countries Economy Growth 4
1.2 Research Motivation 5
1.3 Research Objectives 6
1.4 Research Procedure and Research Structure 6
CHAPTER TWO LITERATURE REVIEW 8
2.1 Relationship between exchange rate and GDP growth rate 8
2.2 Relationship between exchange rate and Unemployment rate 10
2.3 Relationship between exchange rate and inflation rate 10
2.4 Relationship between exchange rate and Government bond 12
CHAPTER THREE METHODOLOGY 15
3.1 Data Description 15
3.1.1 Eurozone Countries Euro-Exchange rate (Quarterly 1999 – 2014) 16
3.1.2 Eurozone Countries Government Bond yield (Quarterly 1999 – 2014) 18
3.1.3 Eurozone Countries Inflation rates (Quarterly 1999 – 2014) 20
3.1.4 Eurozone Countries Unemployment rates (Quarterly 1999 – 2014) 22
3.1.5 Eurozone Countries Gross Domestic Product (GDP) Volume % Change (Quarterly 1999 – 2014) 24
3.2 Multivariate regression analysis 30
3.3 Panel data analysis 31
CHAPTER FOUR EMPIRICAL RESULTS 33
4.1 Multivariate regression analysis results 33
4.2 Panel Data and Analysis Results 37
CHAPTER FIVE CONCLUSION 38
5.1 Conclusion 38
5.2 Research Implication 38
5.3 Research Limitation 39
REFERENCES 40

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