American Dream: Euro Equals Dollar In Exchange Rate After 20 Years, World Economy In Turmoil
Parity at Last
The Euro became equal to $1 following a decrease in exchange rate by 12% since January. This followed fears of recession and high inflation in Europe due to the Russo-Ukrainian War. The war had great impact on European energy supply resulting in an economic slow-down. This will at least take a few months to correct.
The Euro being equivalent to the Dollar, known as parity, has happened after 20 years of disparity. The root of this is the economic slow-down, due to energy supply problems, causing the European Central Bank to tighten policy by raising interest rates in a bid to lower inflation, there are doubts this is possible, however.
Furthermore, Germany has reported a deficit in trade for the first time since 1991 for the same reason of war.
The EU previously received approximately 40% of its gas from Russian but due to sanctions, specifically in the Nord Stream pipeline, this percentage of gas was cut down by 60%. If the gas will be turned on again remains unknown.
Whilst global stability is at risk, Americans may enjoy cheaper holidays in the EU.
Do you think this serious global economic instability is justified in a bid to help the Ukrainians?