On Thursday July 5th the ECB decided to cut its main refinancing rate to 0.75%, for the first time crossing the historical low of 1%. More importantly, it reduced the overnight deposit facility rate to 0%. In doing so, the ECB encouraged banks to transform the liquidity received via two 3-year LTROs into credit to companies and households, instead of keeping it at the ECB deposit facility.

Although it is not advertised on its website, the Paris branch of the Bank of China is now offering its customers residing in France to open an account in Renminbi (RMB), the Chinese currency. This is a modest but symbolic advance of the big maneuvers that have taken place for the past two years around the currency of the second world economy.

With the survival of the euro area at stake, and the reform of the international monetary system no longer a priority of the G20 presidency, it may seem strange to call for an increased international role of the euro.

Europe’s banking system has been in a continuous stage of systemic fragility since the beginning of the financial crisis in 2007-08. The present phase is a two-way process of sovereign and banking crises feeding one another.