"The Era of the 'Global Euro' Begins"
Christine Lagarde, President of the European Central Bank (ECB), stated that the uncertainty surrounding the policies of the Donald Trump administration in the United States has shaken trust in the US dollar, emphasizing the need to strengthen the international role of the euro. She argued that this is a prime opportunity for the eurozone to enjoy the status of a key reserve currency, a position previously monopolized by the United States.
According to Bloomberg and other sources, on the 26th (local time) in a speech delivered in Berlin, Germany, President Lagarde said, "The changes currently underway are opening the era of a 'global euro.' This is a golden opportunity for Europe to take greater control of its own destiny," adding, "However, such benefits are not given automatically. We must secure them for ourselves."
The role of the dollar as a reserve currency is on the decline. Currently, the dollar accounts for about 58% of global foreign exchange reserves, the lowest level since 1994. The euro's share remains at 20%.
President Lagarde identified three foundations necessary to elevate the status of the euro: a reliable geopolitical foundation by maintaining a firm commitment to open trade and supporting it with security capabilities; an economic foundation through the completion of the single market and regulatory easing; and a strong legal and institutional foundation. She also stated that Europe should raise more joint funds at the continental level, including for defense spending.
Bloomberg assessed that President Lagarde's remarks reflect European officials' attempts to turn President Trump's attacks on global trade and American institutions to Europe's advantage.
In a recent media interview, President Lagarde also said that the Trump administration's unpredictable economic policies could present opportunities for Europe. She stated, "It is only natural for Europe to be recognized as a stable economic and political region with a sound currency and an independent central bank."
Meanwhile, Joachim Nagel, President of the Bundesbank (Germany's central bank), said at a separate event in Berlin on the same day, "Europe needs to reconsider its economic model, its defense policy, and how it can move forward with greater independence."
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