The dollar reached parity with the euro for the first time in 20 years

Price Euro dropped this tuesday dollar per unit, a level that has never been reached since the introduction of the single European currency two decades ago, has fallen due to the risk to the continent’s economy of a reduction in Russian gas supplies.

Considered a safe haven, the US dollar has been favored by investors and the currency has risen about 14% since the start of the year and was briefly exchanged at one dollar for the euro around 0950 GMT, the highest price against the European currency. from December. 2002.

Market operators fear a major energy crisis on the Old Continent due to the interruption of the flow of Russian gas through the Nord Stream 1 gas pipeline, which is currently under repair. This tension is fueling fears of a recession in Europe.

The energy that comes from Russia is in the “heart of the storm in Europe”, and the announcement made on Saturday Canada that to mitigate the energy crisis with Russiasend to Germany the required turbines “did not have a positive impact,” said Oanda’s analyst Geoffrey Halley.

“The key question is whether the gas will return after July 21. The markets seem to have already made up their minds,” Halley said.

expectations

According to Mark Hefele, an expert at UBS, the suspension of Russian gas supplies to Europe “This will trigger a recession throughout the eurozone with the economy contracting for three consecutive quarters.”

European Central Bank The (ECB) could find itself in a quandary if it wants to end its expansionary monetary policy and move into a contraction phase to fight runaway inflation that is making matters worse.

For its part, the issuer dollarThe Federal Reserve has more wiggle room to keep raising rates as employment data released on Friday proves the US economy is more resilient for now. (AFP)