On Tuesday, the euro dropped to its lowest level in two decades, falling more than 1 per cent for the day to $1.0283.
It comes as fears of a eurozone recession grow, gas prices skyrocket, and the Ukraine conflict shows no signs of abating.
Inflation in the eurozone reached a record 8.6 per cent in June, forcing the European Central Bank to notify markets ahead of time that it intends to raise interest rates for the first time in 11 years at its July meeting.
However, rising recessionary fears may limit the central bank's ability to tighten monetary policy.
The July Sentix Economic Index, released on Monday, revealed that investor morale in the 19-country eurozone has fallen to its lowest level since May 2020, pointing to a "inevitable" recession.
Over the last year, the euro has plummeted versus the US dollar. In Europe, record-high inflation has been aided in recent months by surging gas prices.
Natural gas prices in Europe continued their steady increase on Monday, reaching highs not seen since early March, as planned strikes in Norway exacerbated market concerns over Russian supply cuts. The front-month gas price at the Dutch TTF hub, a European benchmark for natural gas trading, was seen trading up 7.8 per cent to 175.5 euros ($180.8) per megawatt-hour last spotted trading.
All of these issues have combined to severely damage the euro. Since the beginning of the year, the eurozone's currency has lost more than 9 per cent of its value against the US dollar.
Meanwhile, the dollar's gain continues as risk-averse investors seek a safe haven and the United States Federal Reserve starts on what appears to be an aggressive rate hiking programme.
After hiking benchmark interest rates by three-quarters of a percentage point in June, Fed Chair Jerome Powell predicted the central bank could hike rates again next month.
(Source:www.worldtimetodays.com)
It comes as fears of a eurozone recession grow, gas prices skyrocket, and the Ukraine conflict shows no signs of abating.
Inflation in the eurozone reached a record 8.6 per cent in June, forcing the European Central Bank to notify markets ahead of time that it intends to raise interest rates for the first time in 11 years at its July meeting.
However, rising recessionary fears may limit the central bank's ability to tighten monetary policy.
The July Sentix Economic Index, released on Monday, revealed that investor morale in the 19-country eurozone has fallen to its lowest level since May 2020, pointing to a "inevitable" recession.
Over the last year, the euro has plummeted versus the US dollar. In Europe, record-high inflation has been aided in recent months by surging gas prices.
Natural gas prices in Europe continued their steady increase on Monday, reaching highs not seen since early March, as planned strikes in Norway exacerbated market concerns over Russian supply cuts. The front-month gas price at the Dutch TTF hub, a European benchmark for natural gas trading, was seen trading up 7.8 per cent to 175.5 euros ($180.8) per megawatt-hour last spotted trading.
All of these issues have combined to severely damage the euro. Since the beginning of the year, the eurozone's currency has lost more than 9 per cent of its value against the US dollar.
Meanwhile, the dollar's gain continues as risk-averse investors seek a safe haven and the United States Federal Reserve starts on what appears to be an aggressive rate hiking programme.
After hiking benchmark interest rates by three-quarters of a percentage point in June, Fed Chair Jerome Powell predicted the central bank could hike rates again next month.
(Source:www.worldtimetodays.com)
