Euro reaches parity with the dollar

The price of the euro against the dollar continues to weaken, and is increasingly closer to parity with the American currency, something that has not happened since 2002, given the growing fears that the eurozone will enter a recession dragged down by the consequences of the war in Ukraine.

In this Tuesday’s session, the cross between the euro and the US currency fell to a minimum of 1.0003 dollars, the worst change since December 2002, 0.3 % below the closing price of the previous session.

So far this year, the euro has accumulated a depreciation of around 12% against the dollar as a result of the greater fear that the eurozone will end up entering a recession due to the impact of the war in Ukraine on prices and markets. As well as the advance with which the United States Federal Reserve (FED) began to tighten its monetary policy compared to the European Central Bank (ECB).

In fact, while the ECB announced that it will undertake its first-rate hike since 2011 next week, with a rise of 25 basis points, the Fed began the normalization of its monetary policy last March, with a rise of 25 basis points, which was followed by hikes of 50 and 75 basis points, respectively, in the two following meetings.

K. Tovar

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Source: ABC