Joachim Nagel: The euro in a fragmented world - stability, sovereignty, and global responsibility
Speech by Dr Joachim Nagel, President of the Deutsche Bundesbank, to the Hohenheimer Kreis – Corporate Governance, Stuttgart, 15 July 2026.
In a speech delivered at the Hohenheimer Kreis – Corporate Governance in Stuttgart on July 15, 2026, Dr. Joachim Nagel, President of the Deutsche Bundesbank, discussed the role of the euro in the global monetary system and what is needed for Europe to strengthen its position. The speech focused on the importance of stability, institutional strength, reliability, and trust in the international financial markets, similar to the characteristics that have made the US dollar the dominant currency.
The speech began by noting that the euro is currently the second most important currency in the world, accounting for 20% of global foreign reserve assets, while the US dollar remains the most important currency, holding 57% of such assets. The euro's share in foreign currency debt has grown to around 30%, compared to the US dollar's slightly declining share of 60%.
In international trade, the US dollar is used almost exclusively for exports and a significant portion of imports, while the EU accepts payment in US dollars for about one-third of its exports and prices around half of its imports in US dollars.
Dr. Nagel emphasized that the US dollar is unlikely to lose its dominant role in the near future due to the significance of the US economy and the high costs of changing the system. However, he also suggested that the US dollar may be vulnerable during periods of political pressure, such as the announcement of a new US tariff policy in 2025, which led to tensions in the global financial markets and a temporary loss of confidence in the US dollar.
The speech then addressed whether Europe should consciously strive for a stronger international role for the euro. Dr. Nagel argued that a stronger role for the euro would provide greater strategic autonomy, making Europe less vulnerable to foreign influence. By settling a significant portion of trade in euros, exchange rate fluctuations would have less impact on Europe, and the euro could become a more reliable currency for international transactions.
He also mentioned that a stronger euro could help Europe avoid being influenced by foreign monetary policies and reduce the risks associated with fluctuations in the value of the US dollar.
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