If you were planning a trip to Europe but could not quite afford it due to USD to Euro exchange rate, perhaps now is your chance to visit the Old World without breaking the bank.
European currency has continued its decline today, weakening to a 20-year low against the US dollar on Friday, July 8.
Apparently, the investors are now betting on euro’s potential parity with the American currency, due to some concerns about a very strong possibility of the recession within the European Union.
The European currency has been steadily declining as concerns of a Eurozone recession grew due to rising uncertainty about availability of energy supplies from Russia.
Currently, there’s approximately a 50% implied probability of the European currency reaching parity against the US dollar in August and a 25% chance that it will hit $0.95 by the end of 2022.
Some market analysts are now warning that the euro “remains effectively unbuyable this summer.”
According to the chief global currency strategist at Societe Generale SA, Kit Juckes, Europe’s energy dependency on Russia is falling, but not fast enough to avoid recession if the pipeline is closed.
“If that happens, EUR/USD will likely lose another 10% or so,” Juckes added.
Euro’s downfall has been rapid, considering that it was trading around $1.13 just five months ago.
Euro was trading as low as $1.0081 to the dollar today as of 07:44 GMT.