The dollar surpasses the euro for the first time in history

The dollar surpasses the euro for the first time in history

For the first time in history, the dollar surpassed the euro and stood at 0.98: that is, each dollar is equal to 0.98 euro cents.

Around 9 am, the price in euros per dollar rose to 0.99 euro cents, and then fell back to 0.98.

(See: G7: leaders of the richest countries show concern about the economy).

The fall of the euro accelerated this Friday and the single European currency fell below 1 dollar for the first time since the end of 2002, weighed down by the concern generated by the economy of the ‘old continent’.

In the early hours of the day, the euro lost 0.49%, at $1.0110, having dipped to $1.0072 a little earlier, approaching parity.

Natural gas will drive the euro below parity, whatever the reaction of the European Central Bank (ECB)“estimated Derek Halpenny, an analyst at MUFG.

(See: World service trade maintains recovery despite war).

Due to problems with Russian exports, Gas prices soared on Thursday, reaching levels not seen since March and the invasion of Ukraine.

The prospect of a gas shortage in the euro zone prompts traders to move away from the single European currency. And to avoid a blow to economic activity that this would represent, the ECB is hesitant at the moment to raise interest rates too quickly, despite inflation.

In addition, the risk of a “divergence in interest rates” among the countries of the euro zone encourages the ECB to prudence, said Matthew Ryan, an analyst at Ebury.

The euro will continue to approach parity unless the ECB adopts a shock measure, such as an increase of 0.50 percentage” of its main interest rate, estimated Ipek Ozkardeskaya, an analyst at SwissQuote.

(See: Reasons why the IMF will cut its growth forecasts).

PORTFOLIO AND AFP

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