These same developments fed a surge in consumption through the effects on wealth of rising house prices and through various financial innovations that allowed many households to liquefy their housing wealth. Financial intermediaries were further exposed by generally inadequate compensation for risk and increased leverage.
Regarding its use as an official reserve currency, the euro has already attained the same weight as the predecessor currencies. Within the euro area, Monetary Union has kept member countries from being exposed to harmful intraEuropean exchange rate tensions of the type that many countries used to suffer when external shocks occurred.