The ECB is grappling with mounting financial losses from its decade-long stimulus efforts, now forced to rethink how it manages bank reserves as interest rates rise. Options under discussion include doubling the minimum reserve requirement to 2%—potentially saving €4 billion annually—or shifting to a tiered interest system that could cut costs but disrupt bank behavior. These moves aim to ease pressure on national central banks without overstepping into fiscal territory, as the ECB navigates a delicate balancing act to maintain economic stability.

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