CBDC will have major implications on the Eurozone – ECB’s Penetta

• ECB board member Panetta believes that the digitization of the euro will greatly impact the Eurozone.
• The impact of the CBDC both in the Eurozone and the global monetary system must be carefully assessed.

Fabio Panetta, Italy’s executive member to the European Central Bank (ECB) board reckons that central bank digital currency (CBDC) will impose domestic implications for the Eurozone. Some of the areas likely to feel the impact of a digital euro include financial stability, monetary policy as well as payment systems.

In his opinion, Panetta says that it is essential that these areas be thoroughly assessed before going the digital way. In addition, the use of the CBDC outside the Eurozone would have a vivid impact on the global monetary and financial system too.

The Coronavirus pandemic has had central banks from around the world looking deeper into the research and development of CBDCs. The European Central Bank is also studying the aftermath of the virus and the role of a CBDC. It is apparent that the acceleration of the digitization plan will have a great impact on the role of the euro in the global arena.