ECB boosts euro liquidity access for global central banks

The enhanced Eurosystem repo facility (EUREP) now offers standing access, in principle, to all central banks globally, unless excluded for reasons such as money laundering, terrorist financing, or international sanctions.

This allows central banks outside the euro area to swiftly address potential euro liquidity shortages.

The facility provides backstop euro liquidity against high-quality euro-denominated collateral, with appropriate risk mitigants.

These changes aim to make EUREP more flexible, broaden its geographical reach, and increase its relevance for global holders of euro securities.

The updated framework will apply as of the third quarter of 2026.

The global economy has undergone profound structural shifts since EUREP's 2020 launch, driven by geopolitics and changes in the international financial system.

These shifts have created a more uncertain and potentially volatile financial environment.

The ECB notes that more frequent financial disruptions and potential knock-on effects on euro area financial markets could impede the smooth transmission of monetary policy.

EUREP helps mitigate these negative spillover effects by addressing risks of disruptions in euro-denominated funding markets outside the euro area, thereby supporting monetary policy transmission.

The facility complements the ECB's existing swap lines.