Istorical low: the euro fell below the dollar today for the first time in 20 years
Julius Conley
21 / July / 22
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istorical low: the euro fell below the dollar today for the first time in 20 years
The background for a rapid deterioration, after both currencies recorded instant equality yesterday, is the publication of data on inflation in the US market, which were higher than forecasts
The euro fell below the dollar on Wednesday afternoon, for the first time in two decades. The background for the rapid deterioration, after both currencies recorded instant equality on Tuesday, is the publication of inflation data on the US market. Inflation was higher than forecast, which increased the likelihood of a higher-than-expected rate hike at the Fed session this month, and therefore a stronger dollar. After the fall, the euro recovered, and as of 16:00 (Israeli time) it was trading a few cents above the dollar. The last time the euro was lower than the US currency was in July 2002.
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Analysts have calculated in recent months that equality and further deterioration of the euro are a "matter of time", given the recession threatening Europe, the unrestrained energy crisis on the continent, as well as the ECB's ionic measures to combat inflation. Now the ECB's pressure to raise rates will be sharper at the July 21 meeting, and it may raise it by 0.5%, rather than by 0.25%, as it announced in advance. All eyes in Europe are on Russian President Vladimir Putin and his decision on whether to resume the Nord Stream gas pipeline to Germany next weekend.
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