The cheaper euro is mainly the result of the strengthening US dollar. It is gaining ground due to the expected rate hike in the US. In addition, the dollar is traditionally attractive as a “safe haven” for investors in uncertain times of war.
Other currencies also became cheaper against the dollar. The Japanese yen, for example, fell below 130 yen at $1 on Thursday, its lowest level in 20 years. Unlike the Federal Reserve, the Bank of Japan is sticking to a loose monetary policy. The European Central Bank is expected to raise interest rates this summer at the earliest.
Several analysts assume that the “dollar and euro will be worth the same within a few weeks”.
