European Central Bank (ECB) Governing Council member and Bank of Italy Governor Fabio Panetta stated that the international monetary system could transition from dollar dominance to a multipolar framework with coexisting global currencies.

Speaking on Tuesday, Panetta noted that while the U.S. dollar will remain a key currency, the world "may gradually move toward a more multipolar configuration." Such a shift could foster greater diversification but might also heighten volatility and contagion risks if coordination falters. Panetta emphasized that sound governance is critical to managing these risks, adding that monetary stability still relies on national authority and independent central banks.

According to the Bank for International Settlements' (BIS) triennial survey released in September, the dollar continues to dominate global foreign exchange markets, accounting for 89.2% of all transactions—up from 88.4% in 2022. The euro's share declined from 30.6% to 28.9%, while the yen's share remained stable at 16.8%.

Europe has been striving to bolster its strategic autonomy, including enhancing the euro's global influence. The European Union has improved cross-border payments, strengthened liquidity support, and advanced the digitization of financial infrastructure. Panetta stressed that deeper capital market integration and higher investment in Europe’s economy are essential for the region to play a larger role in the international monetary system.

Looking ahead, he suggested the dollar’s trajectory "will hinge on slow-moving factors," such as the erosion of its traditional pillars, China’s rise, and Europe’s progress toward deeper integration.