MUNICH: The European Central Bank (ECB) has announced plans to widen access to its euro liquidity safety mechanism to central banks around the world, signalling a strategic push to reinforce the euro’s influence in international finance.

Previously restricted to a limited group of monetary authorities, the facility will now be made available more broadly—provided participating central banks meet specified eligibility requirements.

Speaking at a security forum in Munich, ECB President Christine Lagarde stressed the importance of readiness amid growing economic uncertainty. She warned that intensifying industrial strategies, escalating geopolitical frictions and ongoing supply chain disruptions could trigger more frequent episodes of financial turbulence.

To mitigate such risks, the ECB aims to ensure that central banks can reliably obtain euro funding during periods of market strain. This assurance is intended to prevent disorderly sell-offs of euro-denominated assets and sustain stability across financial markets.

Lagarde noted that guaranteeing access to emergency euro liquidity effectively positions the ECB as a global lender of last resort, a move expected to encourage greater confidence among investors, borrowers and trading partners to transact in the currency—even during market shocks.

The initiative comes at a time when the US dollar has experienced gradual weakness following Donald Trump’s return to the presidency, prompting renewed discussion about expanding the euro’s international footprint.

The enhanced framework, commonly referred to as “repo lines,” is scheduled for rollout in the third quarter of 2026. First deployed temporarily during the Covid-19 crisis in 2020, the tool was later reactivated after Russia’s 2022 invasion of Ukraine to channel euro liquidity to select central banks outside the euro area.