2024-01-04 10:03:12
Christine Lagarde, president of the European Central Bank, recently said that the euro would give the bloc more sovereignty in this turbulent world. But EU leaders added that more needs to be done if the Union and the currency are to emerge unscathed from the current challenges.
“The second most important currency in the world”
Central Bank President Christine Lagarde says the euro will give the European Union “greater sovereignty” in a “turbulent world”. In a joint statement celebrating the currency’s 25th anniversary, Lagarda highlighted how the euro has made life easier for Europeans, protected growth and jobs.
When it was launched on January 1, 1999, 11 countries participated in the EU currency project, but later their number increased to 20. Despite the euro’s advance to the “world’s second most important currency,” Lagarde and other EU leaders remain aware of the challenges the project faces.
During one of its worst periods, the currency reached $1.17 against the greenback in October 2023. It has recovered somewhat since then, trading at $1.11 at the time of writing.
The dawn of the digital euro
Lagarde and her colleagues praised the bloc for taking steps to ensure the survival of the euro in an era dominated by sovereign debt crises:
“During our response to the global financial and sovereign debt crisis, for example, we decided on safeguards such as the harmonization of bank supervision and bank resolution or the European Stability Mechanism. Support for the common currency among the citizens of the euro area is now approaching record levels.”
However, the leaders of the EU added that there is still more to be done to leave the currency unscathed by the challenges of the times. These include growing geopolitical tensions, which will leave the EU facing challenges such as increasing spending on defence, greening and the digital transition, the joint statement said.
Lagarde and colleagues according to prioritizing such matters includes the transition of the common currency to the digital age. This will certainly involve laying the foundations for the digital euro, which would be created as a complement to cash.
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