Euro trades at two-decade low against the dollar - 1 USD = 1.01 EUR

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Martin Everson

Offshore Retiree
Staff member
Mentor Group Gold
Elite Member


How harmful this will be to U.S exporters.

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  • The euro fell to a two-decade low of 0.9903 against the U.S. dollar.
  • Strategists are "definitely biased towards further euro depreciation," says a head strategist at Citi Bank.

The euro traded at a two-decade low of 0.9903 against the U.S. dollar Tuesday morning, with analysts predicting the single currency will continue to slide.

"Our outlook and our trades and our position on the strategist side are definitely biased towards further euro depreciation from where we are now," Luis Costa, head of CEEMEA strategy at Citibank, told CNBC's "Squawk Box Europe" on Tuesday.

"This is the primary point of euro vulnerability now," Costa said.

There are multiple factors at play when comparing the euro and the dollar, working in tandem with the ongoing conflict in Ukraine and mounting inflation across both regions.

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khinkali

Silver Member
How harmful this will be to U.S exporters.

Europe will still buy their oil and gas.

Maybe EU will start to implement currency controls? In other news today...
 

Martin Everson

Offshore Retiree
Staff member
Mentor Group Gold
Elite Member

khinkali

Silver Member
I thought the timing was comically coincidental. 1 EUR < 1 USD and also EU want to restrict trading of non-EUR backed tokens.

I removed EUR denominated crypto markets from my project yesterday; they're just not useful for price discovery.

I just wonder where the exchange rate will be by Christmas.

Also, what they're willing to do to defend it and how this will have different affects across the Eurozone. For example German vs Greek residents and businesses. It could get very political.
 

Martin Everson

Offshore Retiree
Staff member
Mentor Group Gold
Elite Member
Also, what they're willing to do to defend it and how this will have different affects across the Eurozone. For example German vs Greek residents and businesses. It could get very political.

Also what will ECB do with rates? Yes they will go up but by how much? They are having to go head to head with the Fed hikes.

For money managers seeing the euro fall below the dollar and the dollar paying a handsome interest rate it could just put more pressure on the euro. But a weak euro will prove handy for EU exporters in the short term.
 

khinkali

Silver Member
Interest rates, inflation, unemployment. It could get very hard to manage all of these at the same time, across countries with such different risks. Especially with a lack of energy and commodities.

They are having to go head to head with the Fed hikes.

A dangerous game. If the World order does start to change then USD will suck in Euros etc. for some time before the dollar capitulates. Plus North America have enough energy in Canada, production capability in USA and human capital in Mexico to put the walls up. Europe, not so much.
 
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