The Blubber

As the U.S. president overturns long-standing economic norms—causing global market turbulence—some of Europe’s top policymakers see a potential opening for the continent’s single currency.

“We shouldn’t downplay it—the euro has been a great success for 25 years,” Bundesbank President Joachim Nagel said during a recent visit to Paris. “If we position ourselves as more competitive, the euro will benefit more significantly as a reserve currency.”

Germany this month abandoned its traditional fiscal restraint to stimulate the economy and bolster its military, prompting a broad reassessment of European assets. At the same time, leaders are beginning to challenge long-held taboos that have previously constrained the EU’s development.

France’s president, a former investment banker, has embraced the moment to advance his vision of Europe as a truly autonomous geopolitical player.

This shift comes as Trump’s policies destabilize the U.S. dollar’s position as the dominant global currency. His tariff measures and harsh rhetoric toward allies and adversaries alike are disrupting global trade norms, while his wavering support for NATO and reported interest in a “Mar-a-Lago Accord” point to a possible reordering of global financial structures.

Trump is also pursuing tax cuts that could further widen the federal deficit. The Congressional Budget Office warned this week that the U.S. could face default as early as August unless Congress raises the debt ceiling.

Still, any substantial move to shift global reserves from dollars to euros remains a distant possibility—if it happens at all. Previous forecasts about the dollar losing its top spot have repeatedly fallen short.

The most recent data shows that the euro accounts for only about 20% of global foreign exchange reserves, while the dollar maintains a dominant share of nearly 60%—a ratio that has remained relatively stable over time.