Banco de Portugal is part of the European System of Central Banks (ESCB) and the Eurosystem, and therefore pursues the objectives of the Eurosystem’s Mission Statement.

The ESCB is composed of the European Central Bank (ECB) and the national central banks of the European Union (EU) Member States, while the Eurosystem only comprises the ECB and the national central banks of those countries that have adopted the single currency.

The Treaty on the Functioning of the European Union and the Protocol (annexed) on the Statute of the ESCB/ECB define the ESCB’s objective and basic tasks. However, as long as there are EU Member States whose currency is not the euro, it will be necessary to keep the distinction between the Eurosystem and the ESCB. 

The primary objective of the Eurosystem is to maintain price stability.

Without prejudice to this objective, the Eurosystem supports the general economic policies in the Union and contributes to the achievement of its objectives as laid down in the Treaties.

The Eurosystem:

• defines and implements the single monetary policy;
• conducts foreign exchange operations;
• holds and manages the official foreign reserves of the euro area countries;
• promotes the smooth operation of payment systems;
• contributes to the policies aimed at the stability of the financial system;
• exercises advisory functions, in its fields of competence, on EU and national legislation;
• is responsible for collecting statistical information;
• issues euro banknotes.

The decision-making bodies of the European Central Bank (ECB) are: the Governing Council, the Executive Board, and, as long as there are EU Member States that have not adopted the euro, the General Council:

• The Governing Council adopts the guidelines and takes the decisions necessary to ensure the performance of the tasks of the ECB and the Eurosystem. In particular, it formulates the euro’s monetary policy and has a relevant role in the Single Supervisory Mechanism’s decision-making process. The Governing Council is comprised of the members of the Executive Board and the governors of the national central banks of the Member States that have adopted the euro.
• The Executive Board is responsible for the day-to-day business of the ECB and implements monetary policy in accordance with the guidelines and decisions of the Governing Council. In doing so the Executive Board gives the necessary instructions to national central banks for the decentralised implementation of monetary policy. It comprises the President, the Vice-President and four other members.
• The General Council is a transitional body, which carries out ECB tasks on account of the fact that not all EU Member States have adopted the single currency. It contributes to strengthening cooperation among central banks and coordination of monetary policy issues. It comprises the President of the ECB, the Vice-President of the ECB and the governors of the national central banks of the EU Member States.