Austrian National Bank Governor Martin Kocher said European financial institutions should prepare for a possible rise in the euro’s use as a safe‑haven asset amid a gradual weakening of the US dollar. Over the past year, the euro has gained about 14% against the dollar, driven by unpredictable shifts in US trade policy and expectations of robust European investment in defense and infrastructure. The dollar still dominates with roughly 50% of global currency reserves, while the euro’s share is about 20%.

Kocher told Reuters that policymakers must be ready for that scenario, although deliberately promoting the euro’s international status is not the regulator’s aim. The ECB is already discussing tools to stabilize the global financial system, including international repo operations and swap lines. This would help manage potential capital inflows and volatility if demand for the euro as a safe asset rises.

The Austrian central bank chief said there are no stability problems with the ECB’s current monetary policy. The regulator would only begin debating policy adjustments in case of significant changes in the global economy. The ECB has maintained key interest rates unchanged since June 2025 as inflation in the eurozone is close to the 2% target. Most analysts anticipate that the ECB will put its policy rate on hold throughout 2026.