FRANKFURT AM MAIN: The euro almost matched the dollar with a more than one-third share of global payments in 2017, the European Central Bank said Tuesday, but still lags the greenback in other measures of worldwide heft.
The unit accounted for just below 36 percent of global payments in 2017, continuing its upward trend from 2015 lows and inching closer towards the greenback's near-40-percent share, the ECB said in a regularly-published report.
Most of the euro's gains came at the expense of the dollar, as payments in other major currencies like the British pound and Japanese yen were roughly stable while the Chinese renminbi declined from already low levels.
The single currency also enlarged its share of foreign exchange settlements, while foreign investments in euro-area companies were "as high as they ever have been since the advent of the euro in 1999," the ECB found.
On the other hand, several vital indicators fell, including the proportion of international debts denominated in euros and the unit's share of central banks' foreign currency reserves, adjusted for exchange rate effects.
Averaging out a selection of gauges it tracks, the ECB economists found that "the share of the euro across a broad range of indicators... remained close to historical lows" after a long slide from its early-2000s peak.
Nevertheless, the central bankers saw "signs of broad stabilisation" in the single currency's global signficance.
ECB policymakers have a narrow brief to ensure price stability within the eurozone, and do not themselves aim to increase the euro's popularity abroad.
But the report suggested that political breakthroughs "may contribute to the depth and liquidity of euro area financial markets," including completing the so-called "banking union" designed to create a level playing field for lenders across the bloc or the similar "capital markets union".
"As an indirect result, this could also foster the international standing of the euro," the authors added.
Comments
Comments are closed for this article.