European Officials Consider Alternative to Federal Reserve's Dollar Support Mechanism

According to BlockBeats, European financial stability officials are discussing the possibility of creating an alternative mechanism to the Federal Reserve's dollar support system, aiming to consolidate the dollars held by central banks outside the United States. Under the leadership of U.S. President Donald Trump, these central banks are seeking to reduce their reliance on the U.S. The Federal Reserve's mechanism provides dollar loans to other central banks, serving as a lifeline during periods of market stress to ensure global financial stability. Interviews with over a dozen European central bank and regulatory officials reveal concerns that these mechanisms could be "weaponized" by the Trump administration. European officials' concerns heightened around April but later eased following assurances from the Federal Reserve. However, the practical challenges of consolidating dollars make the approach potentially unfeasible. A White House spokesperson stated that President Trump has "repeatedly reaffirmed his commitment to maintaining the strength and influence of the dollar."