Euro's reserve status fades as central banks cut holdings

Tokyo

QUANTITATIVE easing may be helping Europe achieve its economic targets, but it's also undermining the long-term viability of the euro by tarnishing its allure as a global reserve currency.

Central banks cut their euro holdings by the most on record last year in anticipation of losses tied to unprecedented stimulus. The euro now accounts for just 22 per cent of worldwide reserves, down from 28 per cent before the region's debt crisis five years ago, while US dollar and yen holdings have both climbed, the latest data from the International Monetary Fund show.