It was well recognized in the run up to the introduction of the euro that the new currency would be the rst serious rival to the US dollar since the dollar’s displacement of the pound as the major international currency. There was much debate about the extent to which the euro would be accepted as a strong currency, the opportunity it offered for portfolio diversication, and whether it would precipitate a shift away from the dollar as an invoicing currency. The euro has now been in existence since 1999. It quickly assumed second place in international nancial markets behind the US dollar (formerly occupied by the deutschmark) and continues to consolidate its position. Is this better or worse than neutral observers predicted? When will the euro’s international importance in nancial markets stabilize and at what level? This chapter takes stock of the international stature that the euro has reached and compares it to the original expectations of academic researchers and commentators.