Euro usage improves in 2018 'tentatively' – ECB

Thursday, 13. June 2019 11:47

The second most important currency in the international monetary system saw an increase in its role from all-time lows last year and in early 2019, according to a report published on Thursday by the European Central Bank. The euro's share in foreign exchange reserves worldwide advanced by 1.2 percentage points to 20.7% at constant rates, where the outstanding amount decreased by 0.2% in dollar terms.

"Several emerging market economies sold foreign exchange reserves to stabilize their domestic currencies amid tighter financial conditions and reversals in capital flows. A large part of those interventions took place in US dollars, mechanically underpinning the share of the euro," policymakers said and estimated the signs are tentative. They highlighted measures to mitigate sanctions like those against Russia and attributed half a point in the change to them. The greenback's share fell to 61.7%, a record low since the introduction of the euro.

The joint currency's share in debt issuance at current exchange rates jumped 2.5 points to 22.7% amid the dollar's appreciation, the document adds.

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