The US dollar appears to be struggling in the global market. Given this decline in the most widely used currency in international trade, the President of the European Central Bank, Christine Lagarde, urged the bloc’s governments to strengthen the economic foundations of the euro.

In her speech in Paris, Lagarde said that it is not enough to “resist external shocks.” The official “warned that the eurozone must transform its economic openness into resilience if it wants to maintain the currency as a pillar of stability in times of global uncertainty.”

US sollar weakness

Lagarde emphasized that the dollar’s retreat internationally “is reopening the debate about the dollar’s role as a global reserve currency. In this context, some European officials believe that the so-called global euro moment is approaching, an opportunity to consolidate its role as an alternative to the dollar.”

She also insisted that Europe needs an environment where capital flows to productive sectors, fostering investment and growth aimed at strengthening the euro’s international credibility.

This is achieved through the harmonization of regulations, tax systems, and bankruptcy laws that currently differ among countries. “Structural problems such as high energy costs, stagnant productivity, and the unwillingness of member states to finance common projects that benefit the entire union” must also be addressed.

The EU seeks to address current challenges with mechanisms such as the Savings and Investment Union, “a revamped version of the former Capital Markets Union,” to create a single capital market that “incentivizes Europeans to invest in financial assets and reduces dependence on external financing.”

M. Pino

Source: diariobitcoin

(Reference image source: Immo Wegmann on Unsplash)

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