RIGA, Jan 26 Reuters The euro zone should not weaponize its own currency in a global conflict as that could ultimately undermine it, an influential European Central Bank policymaker said on Friday, just as the EU was contemplating seizing Russian state assets.

European officials have been debating for months whether to confiscate frozen Russian assets, including central bank reserves, to use the cash to fund Ukraine39;s reconstruction.

But some are concerned that the broader repercussions of such a move, from retaliation to loss of confidence in European assets, will far outweigh the gain.

Weaponizing a currency inevitably reduces its attractiveness and encourages the emergence of alternatives, Bank of Italy Governor Fabio Panetta said in a speech without directly referring to Russia. This power must be used wisely, however, because international relations are part of a repeated game39;.

Europe should still help pay for Ukraine39;s war effort, ECB policymaker Martins Kazaks said separately and argued that the political decision on how to fund that should not be based on the fate of European assets stranded in Russia.

Forget about the assets stranded in Russia, Kazak, Latvia39;s central bank governor said, arguing that Europe will likely never recover these.

I think that hopes that very soon we will be back to the old normal is an illusion, he told a conference. We must stop helping Russia wage this war by still trading directly or indirectly.

The EU, United…