The Euro has been trending lower against the Dollar since May 2021, with losses accelerating in recent weeks as concerns about a dovish ECB relative to the Fed have been replaced by fears surrounding Europe’s economic growth.
Rising recession concerns also boosted the greenback on safe-haven flows on Tuesday, dragging EUR/USD below 1.0400 and 1.0300 with ease. Will we see the pair fall to parity in the coming weeks?
Click the link for a deeper technical analysis on EUR/USD and an insight into the current economic landscape:
While the possibility of EUR/USD trading at parity is more symbolic than anything, there are still implications for such the severe general depreciation of the Euro.
As mentioned by @tommor, import costs will rise, adding to inflation concerns and likely forcing the ECB to tighten more aggressively, albeit at the cost of a recession.
Germany is suddenly short of gas, short of oil, short of parts for its cars and short of buyers for those vehicles. They were short of a leader for a long time and they are again.
It seems like it actually might have very briefly dipped below parity.
Given the psychological significance of this level, there was likely an abundance of buy limit orders that helped EUR/USD bounce yesterday and today.
However, it is important to remember that all trading carries risk. A significant break of 1.000 could result in an even sharper sell-off by triggering stop-loss and sell orders that a number of traders may have placed below this level.
My daughter recently traveled from Florida to Disneyland Paris, the trip cost ( park tickets, hotel and airfare) was less than had she gone to Disneyland in California
I can only hope that this year we see a lot of US tourism into the UK. The GBP/USD rate is great and our hospitality business here has missed foreign tourism so badly.
I’m in London from time to time and its absolutely great helping overseas tourists. We have our strange little ways here as I’m sure you’ll be aware and a lot of stuff is so alien to visitors.
Mind you, it can be pretty strange to us…
I priced a ticket to Las Vegas last month and it was $1600. I even tried to fly into CA, rent a car and drive to Vegas. With gas, I was probably going to pay more and lose time driving. It’s crazy. I would love to fly to Europe if it was cheaper than that.
