The East Caribbean Dollar (XCD) serves as the official currency for eight nations and territories within the Eastern Caribbean region, collectively known as the Eastern Caribbean Currency Union (ECCU). These nations and territories comprise Antigua and Barbuda, Dominica, Grenada, Saint Kitts and Nevis, Saint Lucia, Saint Vincent and the Grenadines, Montserrat, and Anguilla.

Introduced in 1965, the East Caribbean Dollar replaced the British West Indies Dollar. The Eastern Caribbean Central Bank (ECCB) is tasked with the issuance and management of the East Caribbean Dollar.

The East Caribbean Dollar functions under a fixed exchange rate system, with its value pegged to the US Dollar (USD) at a rate of 1 USD = 2.70 XCD. This fixed exchange rate system ensures stability for the East Caribbean Dollar against fluctuations in the foreign exchange market, providing a reliable exchange rate for international trade and investment within the region.

The East Caribbean Dollar is divided into 100 smaller units known as cents. Coins are available in denominations of 1, 2, 5, 10, and 25 cents, as well as 1 Dollar. Banknotes can be found in denominations of 5, 10, 20, 50, and 100 Dollars.

The economies of the countries and territories utilizing the East Caribbean Dollar are varied but are generally small and reliant on tourism, agriculture, and, in some instances, offshore financial services. The tourism sector is crucial, drawing visitors from North America and Europe, while agriculture primarily focuses on the cultivation of bananas, sugar, and other tropical fruits.

While the fixed exchange rate system can foster stability and economic growth in the region, it also makes the countries vulnerable to external shocks and necessitates close coordination of fiscal and monetary policies among ECCU members.

In conclusion, the East Caribbean Dollar is the official currency for eight countries and territories within the Eastern Caribbean Currency Union, overseen by the Eastern Caribbean Central Bank. The currency operates under a fixed exchange rate system pegged to the US Dollar and is subdivided into cents, with various denominations of banknotes and coins. The economies of the ECCU nations are diverse yet generally small, relying on tourism, agriculture, and offshore financial services, with the fixed exchange rate system providing stability and predictability for international trade and investment in the region.