Euro's Launch Creates Low-Risk Investment Option, Shifting Global Currency Demand.
The euro, Europe's new currency, was launched in 1999 with 11 countries joining the European Monetary Union. The euro is considered a low-risk, low-return investment compared to the U.S. dollar. However, the composition of the euro is not efficient in terms of risk and return. The introduction of the euro may lead to increased demand for it as a reserve asset and for payments, potentially impacting the U.S. dollar.