International role of the euro

Definition and policy line

The international role of the euro refers to the use of the euro in global markets and by residents of countries outside the euro area. Non-euro area residents may use the euro, for instance, in payment transactions or financial market transactions with euro area residents or with other non-residents. In particular, the euro is used by the official sector of several non-euro area countries as a reserve currency or as an anchor currency.

The ECB has a neutral policy stance regarding the international use of the euro, it neither hinders nor fosters the use of its currency outside the euro area, which it regards as predominantly the outcome of market forces.

Key figures

The following table provides a snapshot of the key statistics regarding the international role of the euro. It is taken from the latest publication of the annual review of The International Role of the Euro (see below).

For instance, it shows that in global foreign exchange reserve holdings, the share of euro-denominated instruments - around 26 percent - remained virtually unchanged compared to the previous year. In international debt markets, the share of euro-denominated debt securities in total outstanding securities declined by around 2 percentage points to 27.4 percent at end of 2010, compared to the previous year. In the cross-border loan market and the cross-border deposit market, the share of euro-denominated instruments increased by around 0.5 percentage point and 1 percentage point, respectively, at the end of 2010, compared to the previous year. Finally, in foreign exchange markets (daily average turnover), the share of the euro was equal to 19.5 percent in 2010, compared to 18.5 percent in 2007. It is important to remind that changes in the relative importance of the euro in international markets are very gradual.

Key data on the international role of the euro
Sources: BIS, ECB and national sources.
( 1 )  At constant end-2010 exchange rates.
Share of the euro in:
(unless otherwise indicated)
2010 2009
- stock of global foreign exchange reserves ( 1 ) 26.3% 26.0%
- stock of international debt securities (narrow definition)( 1 ) 27.4% 29.5%
- stock of cross-border loans ( 1 ) 19.1% 18.6%
- stock of cross-border deposits ( 1 ) 21.6% 20.4%
- daily foreign exchange market turnover 19.5% 18.5%
(as at 2007)
- settlement/invoicing of goods exports from selected euro area countries to non-euro area countries 68.0% 67.4%
- settlement/invoicing of goods imports of selected euro area countries from non-euro area countries 53.5% 48.6%
Cumulative net shipments of euro banknotes to destinations outside the euro area EUR 107 billion EUR 109 billion

Related ECB publications and press releases

The ECB closely monitors the international use of the euro and, in particular, produces a regular review – "The International Role of the Euro" – which examines recent developments in the use of the euro by non-euro area residents in international trade and international financial transactions. It provides the public with a broad set of timely indicators and statistics, drawing partly on original data compiled by the ECB and the national central banks of the Eurosystem as well as on time series provided by other central banks participating in surveys carried out by the ECB.

The annual review on the international role of the euro of the ECB does not only present recent developments and trends; it also provides an in-depth analysis of selected issues, studying the possible determinants and implications of the international use of currencies. In the recent years, the following topics have been studied in the review:

  • The impact of asset-backed securities on the currency composition of the stock of international debt, July 2011
  • What makes a currency a safe haven, July 2011
  • Prospects for the international use of emerging market currencies, July 2011
  • Excess returns on net foreign assets and international currencies, July 2010
  • Currency choice in the issuance of foreign currency-denominated bonds, July 2009
  • The use of the euro in global foreign exchange reserves, July 2008
  • Asset substitution in central, eastern, and south-eastern Europe: trends and determinants, June 2007
  • Determinants of the currency of invoicing in international trade, December 2005
  • Determinants of the currency choice in international bond issuance by corporations, January 2005
  • The City of London and the international role of the euro, December 2003

This analytical work fostered a stream of research in the ECB working paper or occasional paper series:

Articles in the Monthly Bulletin

Working Paper Series

Occasional Paper Series