The euro is challenging the dollar's global currency status

According to the Society for Worldwide Interbank Financial Telecommunication (Swift) international payment network, the value of transactions paid in euros worldwide is gradually catching up with the dollar, indicating that international transaction activity around the euro is increasing.

In October 2020, the euro even surpassed the dollar in transaction value, although this did not last long.

The gap between the two currencies on the world stage has narrowed considerably since the onset of the Covid-19 pandemic.

The reason for this is the EU's coordinated action to boost the economy during the current crisis, as well as its continued zero-interest fiscal policy, according to statistics website Statista.

Confidence in the U.S. economy and its growth has also been shaky as uncertainty lingers over Biden's plan to "build back better," according to CNBC.

Although, the US dollar still maintains a greater advantage as the main currency of global trade. By November 2021, the difference between dollar and euro trading volume was around 3%.

But economists have been surprised by the euro's continued catching up and narrowing of the gap with the dollar as the dollar has long been seen as the only international trade currency.