Euro just off two-decade low against dollar amid high volatility and recession fears

business
Euro Just Off Two-Decade Low Against Dollar Amid High Volatility And Recession Fears Euro Just Off Two-Decade Low Against Dollar Amid High Volatility And Recession Fears
European Central Bank minutes about its June policy meeting failed to affect the foreign exchange market. Photo: Hannelore Foerster/Getty
Share this article

By Stefano Rebaudo

A pullback in the value of the US dollar offered the euro some respite, allowing it to edge away from two-decade lows reached this week after surging energy prices fanned recession fears.

Risky assets, including the euro, managed gradual gains on Thursday as investors grappled with the risks of a recession and a potential pause in interest rate hikes.

European Central Bank minutes about its June policy meeting failed to affect the foreign exchange market.

Meanwhile, implied volatility remained near its highest levels since late March 2020 at 11.2 per cent, reflecting a nervous market while investors look at the parity between the single currency and the dollar.

The euro rose 0.1 per cent to 1.0194 after hitting a two-decade low at 1.01615 on Wednesday.

The dollar index – which measures the value of the currency against six counterparts – slipped 0.2% to 106.86, pulling away from Wednesday's peak of 107.27, a level not seen since late 2002.

Advertisement

Commodity-linked currencies strengthened as copper prices climbed. Some investors returned to the market on Thursday after heightened recession fears sent the red metal to its lowest level in nearly 20 months.

Sterling was unchanged after British prime minister Boris Johnson said he would resign. It was up 0.5 per cent at $1.1977.

Analysts said the pound was mostly moving on broader economic concerns about a global recession, rather than Britain's political turmoil.

Bitcoin fell 0.7 per cent and was last trading at $20,402. Ether fell 0.8 per cent to 1,176.

Read More

Want us to email you top stories each lunch time?

Download our Apps
© BreakingNews.ie 2022, developed by Square1 and powered by PublisherPlus.com