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For the first time in 20 years, the U.S. dollar has been surging so much that the Euro sinks towards parity with the Dollar, currently trading at €1/$1.01, being almost equal. This is a threat to both Europe and USA, since imports are now much more costly for Europe. The exchange rate is also driving oil prices up, since purchasing a barrel of oil valued at $100, now costs €98-99 for Europe, while a few months ago, the same barrel would cost €80-90 at most.

Goldman Sachs warned that the Eurozone is on the edge of recession, especially with Russia's decision to cut CNG supplies to Europe, resulting in huge surges in prices.  While the war in Ukraine hasn't affected USA as much as it has Europe, it has magnified oil and gas prices, punishing European consumers with the surging living costs.

What are your thoughts? Will Euro's value fall lower than the U.S. Dollar? One thing is certain though, we're going to go through a tough time in the very near future.
Sources:
https://fortune.com/2022/07/07/us-dollar-euro-nearly-equal-value-economy-inflation/
https://www.ft.com/content/48c7041f-1fa4-42ee-99f6-4a5955668fb6

Edit: Thanks LoyceMobile, I meant to say that U.S. exports are much more costly for Europe, bad phrasing.

Importing is more expensive.

Meanwhile, the official interest is still negative.

Politics in the eurozone has become controlling the economy. If winter comes and electricity costs rise, we will see a price of the euro much lower than the dollar.
Brexit, the Ukrainian war, and a lot of difficulties in the eurozone made the currency in its weakest state, not forgetting the rise in interest rates in America that made the dollar stronger and the confiscation of Russian assets with the increase in military spending.

It was probably expected by has been delayed by quite a bit imo.

Most currencies have ended up being devalued against the dollar as the dollar has higher inflation than them (based off estimates) so something like this was going to happen soon (just markets pressing back in their natural directions).

It's a good reminder to not hold too much fiat unless you need to, a few years ago $1.50=€1.24=£1, now both currencies have dropped compared with the dollar.

Somehow it was looking as if the increased inflation rate in US would have an adverse effect on the economy and reflecting on the dollar but this has not been so. The Biden administration has been able to strengthen the dollar against most currency paired with and I have noticed the Euro exchange rate with the dollar, now having little or no difference unlike in the past. The economic indices of the US economy is still favourable to dollar.

maybe in the next few years the value of the euro against the USD will decline, because there are several reasons, firstly the global geopolitical situation, secondly inflation, and thirdly import problems,,, but in my opinion this is only in the next few years,, the value of the euro will definitely recover and will get stronger

According to statements that can be read and heard these days, central banks have started sending warnings about a very likely recession in the next year, which should not surprise us considering how the situation in which the EU finds itself when it comes to oil and gas. Today I read an article in a local newspaper that in Germany they have already started to implement energy-saving measures by turning off public lighting and traffic lights, reducing the heating of water in public swimming pools to the point that in some districts they have completely turned off the hot water in schools and gyms.

For the EU (especially some countries), the euro is now proving to be a bad solution, and the ECB is under fire from all sides, even from the German central bank and their governor.


I look at the whole situation from another perspective, which is that exactly what is happening now is part of the war being waged in Ukraine - and that the EU will pay dearly for all the sanctions. I will not say that it should have been different, because one should always side with the one who is attacked and who is weaker, but such actions often have a high price, and it seems that everyone will have to pay it.

Inflation is everywhere now due to the war. The U.S. inflation problem was partly due to money printing, but plenty of European countries themselves had borrowed too much from themselves in 2020 when they shut down their economies for COVID restrictions so they were bound for some inflation regardless of the war. The current supply chain issues and product shortages just compound a much more complicated issue.

This also highlights how important energy is. You can completely tank a currency by sending energy prices higher because it makes the country's ability to operate (ie ability to produce economic output) more expensive.

The revulsion I had for people, particularly the green climate change activists, who argued that the only effects of the war on Europe for countries choosing to avoid Russian oil was increased prices at the pump. Well, Europe is finding out that isn't particularly the case.

I think it is primarily about all the money they printed just recently and the money they printed off in 2008 that I don't believe they ever pulled back in.
It is coming, there is no doubt in that, I'd say it is here now but everyone is still drunk on spending and the hangover hasn't quite hit yet.

Without a doubt we are going to see an Euro cheaper than the dollar soon, I have read predictions of the Euro reaching 0.95 or even 0.90 by the end of  the year and this is not going to be pretty at all, as not only they will have to deal with raising prices at almost every single market but people losing faith on the economy and spending even less money.

So while the world is on the verge of a recession I think things will get really bad at Europe and I will not be surprised if we begin to see some countries wanting to leave the union as it is already showing signs the experiment could fail.

Well, all of the inflation was somewhat to be expected because of quantitative easing that happened years ago but it's not easy to tell exactly how much inflation is due to QE in combination with the COVID social welfare state countries decided to set up in combination with the war.

It's important to note that even in a bitcoin-only world that wars breaking out would cause you to lose purchasing power due to limited supply and either consistent or higher demand. But, price stabilization occurs once the war ends and production increases back up again, ie supply increases. When the war in Ukraine ends, it's not as if the purchasing power you have with EUR/USD or whatever currency will return back to pre-war days so your point is probably correct, but the real reason inflation is so absurdly high is because of the war so you can't minimize it's contribution.

We're pretty much screwed then. It's fairly easy to claim that the sanctions against Russia have backfired by ruining our own economy, while Russia is flourishing by its increase in crude oil sales. Just think that if Germany is willing to take such drastic measures, which is a strong economy by itself, imagine what other countries will have to go through, such as Italy or Greece.

If I'm not mistaken, I read that Croatia will be adopting Euro from 2023, is it true? If I were you, I'd rather not join the Eurozone.

That sounds awful. Even if crude oil decreases in value in the future, we'll still be screwed due to the rate of exchange, rendering imports a lot more expensive than they used to.

Prices of goods and services matter far more than exchange rates.

To say "the dollar is strong" is a misleading statement. Its only "strong" if its being exchanged for a foreign currency or perhaps precious metals. The average consumer will notice no difference.

I would contend a truly strong dollar would be reflected by prices in stores and gas pumps decreasing. Which is not something we're likely to see anytime soon.

A strong FOREX dollar reflects greater buying demand in contrast to other international currencies.

There is also another aspect to a strong dollar which implies reduced printing of the asset. That's the type of strength we need in the current day economy.

Quite a bad timing for the Euro to lose strenght against the Dollar, specially since Europe is trying to reduce its dependence on Russian energy, ironically its most important ally to reach energetic stability is USA (through importation of gas shipments) and USA partners with the Americas. There is a posibility that USA may garbain with Venezuela to reach a deal to supply energy to Europe and USA itself in the mid-long run.

The EUR/VES pair is beneficial to Europeans since their currency could have a big demand here if a deal is reached.
Let us hope this unfortunate blow does not traduce into more suffering to the people of Europa.

Such great dependence on someone or something is never good, because you never know when that someone will change the rules of the game and leave you stranded. The Russians planned everything long before they occupied Crimea, and regardless of all the warnings from the US that an even bigger war is coming in the future, the EU did nothing to become less dependent on Russian oil and gas.

If someone wonders why they pretended to be blind, then part of the answer lies in the fact that some of the most powerful people in the EU were deeply connected to the largest Russian companies, such as the former German chancellor Gerhard Schröder (https://www.washingtonpost.com/world/2022/05/20/gerhard-schroeder-pressure-rosneft-russia-putin/).


Unfortunately, this information is correct and it will be another big blow for my country, which, according to various independent experts, could not have chosen a worse moment to enter the Eurozone. However, the politics led by domestic politicians is fundamentally anti-national in all segments of life, and the people do not ask anything because it is easier to send a man to the moon than to hold a referendum. A few days ago, the finance minister resigned irrevocably for unknown reasons, and I don't find it strange considering that joining the eurozone will be an even bigger blow to the standard of all citizens - who would want to sit in a hot seat when everything goes downhill...

Europe was too dependent on Russian oil, it goes without saying that sanctions were expected to backfire, Russia had taken that into account before starting the war, Europe on the other hand, not so much. Certainly, this seems to be the worst period to enter the Eurozone, in my opinion, joining the Eurozone despite the situation isn't a great idea. Some countries are way better off using their own currency. I'm expecting that the living cost will get more expensive for Croatia soon.

The problem of having a weak currency in the current context is that traditionally a weak currency favors exports, but if you have a weak currency and very rising costs, such as the cost of energy, what you gain on the one hand you lose on the other.

Germany has closed its trade balance with a deficit and that is very bad news.

Barring a miracle, I see a very dark future for the Euro. There is already talk of a two-speed Euro or what to do with the PIGS. If rates are not raised drastically, it is because of the consequences it could have on the southern countries.

This clearly indicates that European economy is really struggling,  sanctions to the Russian government have really impacted euro badly. But I think it's USD actually which has got really strong recently almost all the currencies are struggling against the USD on the global level. But Russia stopping it's gas pipeline due to sanctions and stopping of other exports imports had really deteriorated Euro's value.

Yea, this is a direct result of how both regions are managing their interest rate.
The Federal reserve hiked it while the European central bank kept it low.

Also, the market considers US dollar safer than Euro. So maybe people are pulling their money out of Euro market in lieu of what's coming?

and maybe civil wars in the Netherlands could be a factor too? The market reacts negatively towards any political fiasco.

Sorry guys i dont really understand about this one, what will happen if USD equal to EUR is the EUR gonna collapsing or it will good to USD. because in my country itself USD is strong usually the rate about 14.400 per 1 USD yesterday is touch 15.000 per 1 USD

Yes it’s very low compared to a decade ago or during the global finance crisis when it was around 1.50 EURUSD. I remember trading forex back then and the ratio was already around 1.30-1.40 or so. To have it reach parity is crazy.

However keep in mind back in 2015 or so it came close to parity also. Low was like $1.05 and people then assumed also that it would break parity but it never did.

In this context it is good for the USD which remains the safe haven currency, despite what they print and inflation. Since the US does not have the problems of Europe, they have been able to raise rates and be strong in this context.

The Euro is almost equal to the Dollar and it will not collapse because of this, but the Eurozone economy will be more negatively affected because raw materials such as oil are bought in dollars, so the Eurozone will find it more expensive to buy oil, regardless of how much the price rises in itself, which affects inflation in general and the production costs of companies, making them less competitive.

Regarding your country, your currency is very weak against the dollar and now a little more recently because of the above mentioned that it is still the safe haven currency, and the big winner of all this.

DXY is still likely to continue rising when the FED will announce an interest rate increase to control inflation. Europe is on the verge of entering an economic recession, if this situation persists and there is an energy crisis in the region, in 2023 the European economy will be even more negative.
Not only did the euro depreciate against the dollar, but most other currencies were in a similar situation.
Lists currencies against the usd, the only green that can be seen is the Russian ruble.

https://i.imgur.com/yERfPit.jpg

This shouldn't be a shock to anyone really. I mean look at what dollar has been doing, and look at what EU has been doing. FEDs at least try to do something, what does Europe plan for this situation? I think this isn't going to really hurt them a lot.

I know that it looks like a bad deal, but considering all the things that’s happening in my nation, I feel like this is nothing at all and shouldn't be considered a big deal. Think about it, we have nations with 50%+ inflation all around the world, and Europe is cryignabotu like 10% at max, most have lower. I get it, you never saw that much in Europe before, but it is still a beast compared to all little nations.

Don't forget that rising rates also means recession if they go too far with it. You can't keep increasing rates so fast and hope that it will work. A little rising can make people spend less and decrease inflation. Too much and you'll crash the stock market, companies will go bankrupt and won't be able to pay their employees and pay back loans. They will simply default on everything which will kill smaller banks. As a result when they finally decide to offer another stimulus package it will be too late because service providers will already be closed for good.

I would guess that what happened to Germany is not really a single individual deal, it's a common thing for nations these days and that's understandable. Also, we are talking about an economical collapse that is worldwide and probably once in a hundred years type of deal with pandemic, it's not really a common thing.

Maybe from now on it will become more common who knows? But, it wasn't so far. This is why having a weaker Euro is not a shock, we have weaker everything. USD could be getting a bit better for the past few months, but that's not a sustainable thing neither, you just watch, I bet it will get much worse in the future as well when the rates go down. That's when Euro will continue to be better.

What has "happened" to Germany is very bad news and unthinkable not so long ago:

Germany’s much-vaunted trade surplus disappears as import prices surge (https://www.cnbc.com/2022/07/05/germanys-much-vaunted-trade-surplus-disappears-as-import-prices-surge.html)

Having what was considered the economic locomotive of Europe running a trade deficit, with an increasingly weaker currency, rising energy prices and preparing for gas rationing (https://nypost.com/2022/06/23/germany-could-ration-gas-this-winter-as-russia-cuts-supply/) paints a very dark future for the Eurozone.

And the Euro is pretty much equal to the USD now. Google displays the exchange rate equal right now.

https://i.ibb.co/HTRpS7Q/usd.png (https://ibb.co/tpnPGB5)
The current rate is at 1.0040 EUR/USD, and lit's falling as we speak. Things are not looking good.

https://i.ibb.co/tz1r6v0/usd2.png (https://ibb.co/8bQZwfy)

And everything indicates that it will continue to fall, if the ECB does nothing, which it looks like it will not do, at least until after the summer. In reality, the ECB is breaking its core mandate to control inflation, but it is at a crossroads because with the current monetary policy it does not control inflation, but directly encourages it. However, acting to stop it could end in an economic disaster that would start with the countries of southern Europe, so it is in a catch-22 situation.

I never expected this situation that we faced after many years. It shows that things are getting worse for Europe. If it continues like this and the dollar gains a little more value, it means that the crisis in Europe will grow even more.

There it is: parity! Euro dropped 19% in a year, and interest is still negative. It's almost as if there's a limit on how much BRRR a central bank can do without destroying the currency.
And this is the main reason I'm into Bitcoin: it can't be inflated by pressing a button.

And for a time it will be a good move if they stay silent.
Trying to prop the currency right now is just a waste of time and money, and not everyone wants a powerful euro, what the ECB is waiting is for is the gap in inflation growth that will happen sooner or later this year and for the obvious demand destruction that will come probably late autumn.
That is the moment when, if the consensus is that a stronger Euro is needed the ECB will act, but if they do this soon it will be way too costly and with poor results, so better let it slide for a while and focus on the growth of exports and demand destruction in imports which was a thorn already in European's economy.

All articles tend to point a new rate hike no sooner than September and in my opinion, they shouldn't move sooner than that.


But it's against the $, and if we have a printing contest the US would win by one hell of a margin.
So, why isn't the opposite happening?  ::)

The Fed has raised interest several times already.

So the limit is not the amount of money printing, is just how much you can raise the rates. If the ECB would have raised it in tandem with the FED....there would have been no consequences?  :D

Unthinkable a bit before, a few years ago, but not right now. It's literally how the world is doing right now, after the whole pandemic deal the world went into shit with finance and economy, and why would Germany be a nation that stand straight and even made some surplus when all other nations screwed up?

Of course, it's not a good thing that their economy is not as strong as it used to be, but to be fair to them they are such a strong economy that, I would still prefer to be living there than live where I am. Just because they got worse, doesn't change the fact that most other nations did even worse, so Germany still looks like a lovely amazing nation while going worse. All in comparison basically.

I would be curious to know which nations come to mind when discussing hot growing economies of the world to invest in.

One obvious candidate is BRICS. Brazil. Russia. India. China. South africa.

There has also been mention of the four asian tigers. Hong kong. Singapore. South Korea. Taiwan.

There isn't much marketing, investment or hype being thrown behind economies of european nations however.

There are european castles selling for only €2 million on sites like:

https://castleist.com/castles-for-sale-in-europe

Which could reflect a lack of demand for higher income earners wanting to move there.

It might be safe to say, europe has been on the verge of recession for quite some time. None of their joint attempts to develop next gen technology like the euro fighter typhoon have fared well. Policies like austerity have been controversial at best.

There are about 40 000 castles in France, about 20 000 in Germany, and every single other country has them at least in the thousands, including the Czech republic for example, which has more than 2000...
Also, the "only" 2 million is highly misleading, such a castle has enormous costs, if something goes wrong it's a monument so you're plus going to have to pay a te of experts for restoration as it was before, plus the army of housemaids and gardeners needed only to keep that thing clean.
I live next to one of those, 2 meters think walls that get warm only in summer, half a meter wide stairs so that at every restoration when things need to be moved in and out they are taken with a crane through the windows, a one hundred meters and 10 meters steep access point which of course you can't get through with a car and so on, you would have been a masochist to live in it. Oh, did I mention two graves? And in this case, you're lucky cause you know where the bodies are...  ;D

https://castleist.com/2-7m-rheinland-pfalz-germany-renovated-castle
Imagine the tip you would have to give to the pizza guy


Yeah, we've been bankrupt since the middle ages, funny how were still crumbling and crumbling, recession after recession and still, this is where all the people from BRICS, CIS, 4 Lions (not the movie) want to live and send their children, much mystery!

European economy is dependent on its heavy engineering industries and manufacturing units. And these units were dependent on cheap pipeline gas from Russia. EU did self-harm by imposing sanctions on Russia and thereby disrupting the Russian gas flows. At the same time, the American economy got a boost in the form of higher demand for its shale oil and gas. For the US, the primary objective is achieved. They have managed to replace Russia as the main gas supplier to the EU, despite being priced at almost double the previous level.

I think I understand from what you say that doing nothing is a lesser evil, not that the ECB is doing great.

Do you see much future for the eurozone? They are now worse off than when the sovereign debt crisis was resolved with the "whatever it takes" of Draghi, then president of the ECB, with the difference that now much more has been printed (https://thetradable.com/charts/federal-reserve-and-european-central-bank-print-money-like-never-before) and there is galloping inflation.

I suppose the euro and the eurozone will survive but I see it more possible now than 3 years ago to end up creating a two-speed euro or something.


In reality, the number 1 country where people want to emigrate and send their children is the USA. Then we can debate whether Europe has less inequality or better healthcare for the average citizen, but the US beats Europe on that.

Inflation hitting the Euro Area is due to soaring prices drifting the Euro to US Dollar and price fluctuating around equilibrium. The hike in the US interest rate was one key factor that gave the Dollar its strength over the Euro couple with the effect on Ukraine war having more effect on the Eurozones as compared to the US

In 2008, 1 euro was worth $1.57 at the peak. That's a 36% drop. Could this have anything to do with expanding the euro zone?

and same thing is affecting the rest of countries considering dollar getting stronger and stronger (costly actually) so as to foreign reserves in other countries are downgrading. Rupee (INR) has also fallen badly recently which is directly hampering the import export business.

For example, in my laboratory when we used to get any ELISA kit from USA at cost of 500-600 bucks now costs me more than 800+ plus including its import duty and swift charges. Everything is so much hiked these days. You can’t get god dam kit cheap which we using for health services. Its bad and dollar rates can hamper anything.

Europe is paying the price for standing by Ukraine. It can be said that this is a summary of the current economic situation in Europe. The sanctions imposed by the United States and NATO on Russia because of its war on Ukraine have led to severe suffering in the European economy. It is clear that the coming winter will be very harsh for Europe, especially in light of Forecasts of the weather will be very cold this year, the rise in fuel prices in advance caused the economic stagnation in the Eurozone.
The funny thing is that I read in some economic websites that: "Investors began to flee to the dollar as a "safe haven" and a reliable means of protection against inflation".
They will soon discover that they made a big mistake because the dollar's situation is not better and America is suffering from inflation as well.

the possibility that the euro's value or price will decline and be lower than the dollar is possible or has a fairly large degree of probability. because we see that Europe is in the midst of a crisis. spikes in the prices of necessities of life rose rapidly. due to the influence of the strengthening dollar and other factors as mentioned above.
then an economic recession could hit. but considering that Europe is a country that has a good long history. then I think they will look for and find a solution so that at least the euro exchange rate can rise again.

Of course, ECB CAN'T do anything great right now.
The only choice is to brace for it for a few months and let the others take reckless measures to stabilize the international situation, let the Americans hike the rate, and suffer a bit from the ever-devaluating euro as you have no chance to act right now against the US and act only when the FED will be left out radical options, they can't go on this path forever.

I see now way the ECB will be able to return the parity to even some 1.1 right now without far more serious long and short-term consequences.


Neha, right now the situation is still far better.
Remember that during the last crisis the problem was not inflation, it was a complete collapse of demand, the EU went into near deflation because basically everything was crashing around, this is not the case now, things are still working (literally working, check employment) and this thing can't go over infinitely.

The main factor driving inflation is energy prices, but you can't have them high when the economy is crashing, this is impossible, with nobody working there is nobody using energy and you can see with oil,coal,copper, prices what fear of recession is doing.


Oh yeah, my bad, the crumbling EU is outranked in desirability by the crumbling US... ;D
Anyhow, can you share the source for this? Usually, those polls break the EU in each country so of course, they are lower but overall they outrank the US.


All of them have an economy of around ~450 billion, 1/3 that of Spain, they couldn't have influenced a thing even if they wanted to do.
The Norwegian krone was 0.20 in 2008, it's now 0.10
The Philippine peso was at 0.025 in 2008,  it's now 0.018,
The Canadian dollar was 1.04 in 2007, it's now 0.76,

It's not much the weakness of the Euro now, as the weakness of the US then and return to power now

This just reminded me of some sad statistics (https://www.sandyhookpromise.org/blog/gun-violence/16-facts-about-gun-violence-and-school-shootings/): "Each day 12 children die from gun violence in America. Another 32 are shot and injured". In other words every 21 days there are more child casualties in USA compared to total number of child casualties in a decade inside war-zones like Syria (900 in 11 years!).
No wonder the reverse migration is on the rise.

The USA has many bad things, such as a health care system for those who can afford it (with exceptions such as Medicare and Medicaid), exorbitant drug prices, an opioid problem, homeless people, etc.

It is usually a better place to live for someone with a high income than for someone who works at McDonald's and it also depends on where he lives, better in Nashville than in Detroit.

However, I don't know if I trust the statistics of that website very much, I think you have a confirmation bias that makes you look for data that confirms what you previously believe, like when you said that more than 1 million families went homeless in the UK in 4 months. (https://bitcointalk.org/index.php?topic=5403931.msg60439526#msg60439526)


I saw it somewhere, but googling "number 1 country to emigrate to" the first thing that comes up is USA:

https://worldpopulationreview.com/country-rankings/immigration-by-country

Not all websites match, for example this one:

https://reachimmigration.com/en/blog/here-are-top-10-countries-to-migrate-to

But in this web where Germany, France and Holland appear in the top ten, it would be necessary to see if they consider that someone who goes from Bulgaria to Germany is "emigrating", which would be incorrect because there is free movement of people, and as for the aggregate EU that you comment the same: I hope that in the sum they do not count the people who go from Poland to Germany within the sum of emigrations.

We knew this was coming. Experts were predicting the Euro and USD parity since the inflation tightened its grip. Fed reserve’s rate hikes have boosted USD to a great extent and the Euro zone is still under the clutches of the ongoing energy crisis and recession fears.

I don't know if people see that happening, and it's getting worse as the economy shrinks because of the overwhelming social effects of it. I am not a fan of conspiracy theories, but they seem to have been and are being made and implemented in this life. Personally, I also see a process of decline and distrust from countries that were once the center of the world, and it seems that control backfires and causes polarization and balance to be gradually moved to the center of the world. . It is clear that the position of both the US and European countries is declining, and China's rise in the future is inevitable.

All statistics are inaccurate one way or another, the reality doesn't change though. The facts are:
- There are kids in US schools shooting each other
- Gun violence is the leading the leading cause of death among children (https://en.wikipedia.org/wiki/Gun_violence_in_the_United_States) in US, more than cancer (https://www.science.org/content/article/guns-kill-more-us-kids-cancer-emergency-physician-aims-prevent-those-firearm-deaths).
- The gun violence in general is spread to all states and it is increasing (https://www.cdc.gov/nchs/pressroom/sosmap/firearm_mortality/firearm.htm) each year
- The number of children with firearm injuries (https://www.nejm.org/doi/full/10.1056/nejmc2201761) is also increasing every year.
According to CDC it used to be between 4 to 8 per day between 2006 and 2016, whether it is 44 or 21.8 per day (https://www.teamenough.org/gun-violence-statistics) now is just details.

It's the same with homelessness in UK. Whatever the real number is, the fact that it has been increasing rapidly this year doesn't change.

Generally agree with what you say. There are many things I don't like about the USA, but there are many people who want to emigrate to it, which indicates that there are many countries, for example in Central and South America, where they are worse off.

But on this I do not agree:


The difference between 1 million families and 70,000 families is very significant, and those 70,000 families will soon be receiving benefits of one kind or another.

The FED is constantly raising interest rates. In this case, investors move their euro savings to the dollar (It's an inevitable end). If the US dollar continues to strengthen, it will be difficult to export American products to the global market. If the euro continues to weaken, it will be difficult to import energy products into the EU. As in everything else, balance is very important in this matter as well. Please let's not experience another global crisis. I'm so bored now.

We know that one of the reasons why this can happen is because the level of Inflation in the US has now reached 9.1% and this is quite a big thing and even this is the highest level of Inflation I have ever felt for the US.
Their prices even in my currency are almost equal and have differed only slightly in the last few days.

Yes I think the US Dollar will be more valuable than the Euro in near future. Europe is screwed and I don't see our politicians reacting fast enough to offset all the negative shocks. The Russia Ukraine war is having negative consequences on the whole world economy, but Europe is hit the hardest. USA is pressuring European countries to buy energy outside of Europe, preferably from North America. Cheap Russian gas is what made European countries so competitive, now we have to buy gas for almost 3 times the usual price. On top of that is inflation still rising and the European central Bank is much slower to react than the FED. It might take years for Europe to recover from this.

The problem of the emergence of today's "parity" is more negative for the Euro than in 2015. Now, in connection with Russia's terrorist attack on Ukraine, such unpleasant facts for the German economy as the global monopolization of gas supplies for the industrial sector by a terrorist country against which sanctions have been imposed have "surfaced". Not the possibility of a quick solution to get out of the situation. And most importantly, gas supplies have become a mechanism for Russian terrorism against the EU, and especially Germany and France, which in turn are the economic locomotive of the EU. It is for this reason that it is quite logical to assume a recession, and not for 1 year, of the EU economy (read Germany), which by itself leads to a cheaper Euro. Nothing out of the ordinary, everything is logical. I hope in 3-4 years, the German economy, having stopped gas ties with terrorists, will begin to return to its previous indicators.

It seems that parity has acted as a support. Although it came down a bit, being a dollar more expensive than a euro for a few moments, the exchange rate has remained stuck in the 1 and a bit zone, being currently 1.01 according to google.

Some predicted that it would continue to fall until it reached $0.90 per €. We will see if they are right and this is a momentary stop or the decline is over, as the ECB has announced that it will raise interest rates, albeit timidly.

Sleepy Joe's visit to West Asia (or as they like to call it Middle East) and his visits with the apartheid regimes seems to have temporarily calmed the energy market and even temporarily brought oil price below $100. That helps euro strengthen a little bit.

We have to see what the future holds for energy prices though. There are a couple of conflicts waiting to break out in oil rich regions such as Saudi Arabia that could shoot the price up again and euro could tank more if that happens.
Other than that all the global drama is currently slowing down, in my opinion.

Although there was some kind of relief in the market, crude oil's price is increasing once again, trending at $100 for WTI and $104 for Brent oil as we speak. I've read a few predictions that it might fall in the upcoming months, but the EUR/USD rate of exchange isn't helping and certainly isn't going to recover back to pre-war levels anytime soon. The issue is, that inflation keeps soaring and there's no noticeable relief. Gas prices dropped from €2.50/liter of unleaded 95 petrol to €2.29/liter, which isn't a significant difference, the cost of fueling is still extravagant.

Inflation is hitting the world hard and this is the hard time for every county - this Euro and dollar coming together is an alarm for both the counties but i think now the time has passed - thing will get more tougher with every passing day

There's a minimal recovery, almost reaching 1.03 USD/EUR (1.0269 USD/EUR to be exact), while crude oil is also showing petty signs of relief. However, can't say I'm confident enough to believe that any kind of improvement anytime soon, despite the current small, but positive signs. What's also interesting is that the cryptocurrency market is also showing similar signs, with Bitcoin surpassing $22.000, it could be coincidental, correlated or both.

Much of the dollar's strength is due to concerns that Europe is in trouble to refuel for the coming winter due to the Russo-Ukrainian war, while the US has its own fuel and the rest is anticipation of a rate hike.
the fuel crisis in Europe could cause an instant recession there and while the US economy is still heating up.
and the conflict hit Russia because it couldn't buy and sell many products from Europe and to Europe, but it turns out that conflicts are more common in European countries.
surely many people may not think this can happen because so far the euro has been designed in such a way that its value is higher than the dollar, but this can all happen due to several factors and apart from European political uncertainty, war as well.

West started it all by offering NATO membership to Ukraine. What followed is food crisis, oil crisis, inflation, rise in federal rates, and now we are staring at impeding recession. Ukraine has already lost so much. Where is NATO now.

The energy crisis had already started from September/October, before the war begun, which also fueled inflation. However, the war quickly triggered the acceleration of a pre-existing situation. Europe got itself into trouble by imposing sanctions on Russia, while it was dependent on its oil and gas. USA on the other hand, as the previous poster mentioned, has their own reserves and didn't get screwed over that much. The whole situation has now backfired with the only victim being Europe and its citizens.

The worst is yet to come, with Russia steadily progressing on Ukrainian soil.

I don't have to say much into this because I quite know even though Ukraine got lost into the conflict all the crisis between Ukraine and Russia at least Ukraine has met and their invention and their demand known to the society. I believe that even though the crisis end or ended bye Ukraine not having or landing to their own obligation, at at least they be respected.

From what we have seen so far, the sanctions against Russia have hurt the EU more than anyone else. The Americans are actually profiting from the sanctions, as they are now a net-exporter of oil and gas. China is also profiting from the sanctions, both politically and economically. And for the EU, the negative impact is going to be for the long term. Their industries won't be competitive without cheap Russian gas, which will be re-routed to Asia in the medium to long term. Alternate supplies such as Qatari LNG will be much more expensive and that will doom the heavy industries.

This is pathetic, actually, you sanction someone and you end up worse than him. Germany, which with its green policy closed its nuclear power plants while China did not stop opening them, now goes back to burning coal, and it is not the only one:

Germany fires up coal plants to avert gas shortage as Russia cuts supply (https://www.ft.com/content/f662a412-9ebc-473a-baca-22de5ff622e2)

The war is happening on European soil and there is no escaping that fact, but as things stand now, the EU will pay the highest price because it did not find alternatives in time that could at least to some extent be compared to cheap Russian energy sources. At this moment, the question arises why they became so dependent on Russia, especially since they saw what happened in 2014 and in 8 years they did nothing to find alternative solutions.

I would say that there are many domestic traitors within the EU, and that some foreign countries that want to weaken and break up the EU also played a big role in what is happening. Phase 1 - Brexit, phase 2 - war in Ukraine, phase 3 - bringing to power politicians with anti-EU views.

Because EU has zero independence, all their policies are written by United States and they just follow it like slaves.

Take the situation with gas for example, Iran has more gas than Russia, there is even a very high success rate when exploring for more. Despite all that and the fact that EU members stating they won't follow the US sanctions, even during the sanction removal in 2015 they never really buy Iran's gas/oil simply because they were ordered not to by US. There were even plans to connect a pipeline from Iran all the way to EU like NordStream but again the orders came down and they obeyed :)

Today it is too late to undo 4 decades of bad decisions...

Oh, and who could that foreign country! be?  ;)
The one that was always afraid of a strong Europe because it knew in a case of conflict with a united Europe they would get their ass handed to them?
The country that fears Europe as the only times it has been able to defeat a major European superpower it was because it received help from another?

Who else but Russia with its glorious history of defeating Napoleon (which actually never happened since the Russian never defeated Napoleon in battle, neither at Borodino, neither at Maloyaroslavets or Smolensk) fast forward bypassing the loss of Crime to Napoleon the third, the defeats inflicted by Japan and the catastrophic ww1, to ww2 where they only manage to survive because again they were facing a single superpower and had backup from two of them.

Why would the US fear Europe, why would it want to weaken its most reliable ally, and why would you want a poor friend? It's pretty clear who the ones trying to destroy Europe are, and they use the same propaganda, the US is the warmonger that seeks to keep the EU as a vassal, and so on.

Remember how you took the bait of the warmongering US and the forgot what cereals for breakfast episode?
That's how it works, and many people right on this forum are no strangers to this.


When do you say long term you mean after the conquest of Ukraine which according to some self-nominated strategist happened in May?
 

It's not too relevant to EUR/USD rate of exchange, but the Russian Nord Stream gas supply has been restored today, after a 10-day pause for maintenance., resulting in a drop in oil and gas prices. Europe hadn't ruled out the possibility that Russia may stop gas flows via Nord Stream permanently, once the maintenance was over. Orders have now resumed at 40% of its capacity. Hopefully, that may relieve the oil market and European consumers a tiny bit, not lifesaving but still an improvement.

Source: https://oilprice.com/Energy/Gas-Prices/Russia-Restarts-Nord-Stream-Gas-Supply-To-Europe.html

russia couldn't afford to keep it offline any longer. lol but yea I can see Russia shutting it down again especially as a pressure move come this fall.
Nothing like creating some panic on the market and drive prices up that benefit you.

While the difference between Euro and Dollar wasn't huge, I was also very used to there being a certain difference, which makes the current situation quite weird. It's not surprising that there are significant economic issues, as Covid was hard, and now there's Russia's war, but also because even prior to Covid the timing was expected to be nearing an economic recession. And since the US is stronger than the EU, it's not surprising that it's experiencing smaller issues. IMO, though, we won't see anything very significant later on with dollar and euro. Euro fell, sure, but I don't think it will go below dollar, at least not significantly so.

The Russian Oil saga should be one that I believe dialogue can solve, there is a bit of bad blood from other countries that rely on Russia for oil and Russia themselves, countries like that may claim to not needing Russia anymore it the honest truth is they do and so does Russia too. If a harmonious dialogue can happen and both parties air their opinion I this an agreement can be reached that would be beneficial for everyone and even help euro out of recession.

Russia has recorded huge profits due to Europe's sanctions, which drove oil prices to skyrocket. On top of that, they've also resorted in finding other markets to sell their oil, such as India and China. The only losing party is Europe, not Russia, we're the ones getting screwed over by the excessive fueling costs.

The problem is not the responsibility of NATO, but the United States in particular, hiding behind NATO, since the countries affected by the collapse of the euro price are also members of NATO. The United States is a major beneficiary of the Ukrainian crisis and may begin to provide alternatives to what Russia provides after forcing the European Union countries to impose sanctions on Russia as if this would weaken it or save Ukraine. The euro is only the beginning of the crisis, awaiting further collapses.

Due to the high population density it makes sense that India and China are clear alternative markets for Russian energy. China buying Russian gas/oil is something I saw coming, but something I did not expect was India taking this opportunity as well.  As far as I knew India has a quite stable diplomatic and economical relations with the USA, I would have guessed they would join the boycot.  ???

Russia sold discounted crude oil, selling at a 20% discount on one of its worse price rallies. It was expected that other countries would bite, which lead to billions in revenue for Russia.

Crude oil is seeing a slight decline in its value, however, as long as the EUR/USD rate of exchange remains close to parity, we won't see major drops at the pumps.

India only has negative relationship with China but not Russia. I kinda expected them to bite in on the oil bargain by the Russians. They needed that quick profit, and what can the US and its allies do anyway? They can just call out India for the said behavior but that's about it. Profits are already realized for Russia, and it looks like everything is business as usual, too, for US and EU by looking for other oil sellers in the form of the Middle East and Africa.

India played a very good game.They supported America and then they got the oil from Russia as well.
I must appreciate the Indian government for playing dule game and also since India is American Allie they always support Indian Govermnet

What is the point of sanctions against Russian oil/energy if India is allowed to buy and process their oil?
What if India uses cheap Russian oil to refine and manufacture products derivated from oil to export towards allies like USA?
It does not make much sense, because indirectly Russian Oil still have place withtin the market of USA and their western allies.

I am surprised Biden's administration have not seriously called out Modi's.

Now after creating the mess - Bidan has gone to Saudia Arabia to save himself from the defeat in mid term election.
Biden is not a good president - I think Trump America was far better than Biden. He has created the Russia ban mess and now again there is hike in petrol prices.

Russia is restricting gas flow coming from Nord Stream once again, cutting supplies in half from 40% to 20%, claiming that one of their turbines needs maintenance. The war could last years, while the fear of Russia eventually permanently stopping gas flow to Europe is extremely likely in the upcoming months.

 ;) good news for us dollar! this is interesting. Dollar had been much lower than Euros for the past decade i think.

Does this mean bullish run is coming soon??

Experts in the EU have also warned about this before. Now that it has happened, sadly they do not know what to do other than criticize each other for what has happened. The European Union is now really stuck in a gas war with Russia, despite previous claims that it will soon find an alternative source of Russian gas.

If Europe and the US still want to impose a ceiling on the prices of Russian oil and gas, then stopping gas exports to Europe will happen and will prolong the war even more.

As I mentioned in my previous post (https://bitcointalk.org/index.php?topic=5405598.msg60586557#msg60586557), the euro seems to have rebounded a bit following the ECB's announcement last week of a rate hike, in this case by half a percentage point. We will have to see how this turns out, but in any case I believe that rate hikes are healthy, after the massive printing that has taken place in recent years. Will they be able to continue this policy for long? I think it is unlikely.

Europe got itself screwed over by imposing sanctions on Russia. It's not new that we are dependent on Russian oil, what did Europe expect to happen? Now we, the regular citizens are paying the price of their actions.

I wouldn't say that, it's approximately sitting at $1.01/€, a few days ago it almost reached $1.03 but didn't stay there for long.

Yes, it has rebounded. It is oscillating at the $1.01/€-1.03 level, with the parity appearing to act as support. I am quite curious to see the evolution, as in this thread you can see a forecast of $0.90/€ that seems that for the moment it is not going to be fulfilled.

In any case, whether the euro falls further against the dollar or not, it is clear that in terms of currency strength the euro has lost out.

Before the recession of 2008-09, the exchange rate was like €1 = $1.50. During the last one and half decades, the value of Euro has been on a continuous downward spiral. Although most of the currencies have gone down against the USD during this period, with EUR the fall has been very steep. If this trend continues, then within another decade the exchange rate will be like €1 = $0.50. European economy is in decline. And this is having an impact on the currency as well. There is no short fix here.

And in another decade €1 = $0 , because that's how math works, Mr 40 days in a month?
Check what the parity rate was on x-mas eve in 2016!


They've chosen the worst moment to hike rates, why not wait for the US as they were already clearly ahead with those, and then rise the rates for the first time?  I said a week ago, that the moment is bad and it won't achieve anything spectacular, let the currency go down as the increased price from 500 billion in energy imports means nothing compared to 5 trillion in exports.
For the first time in the last 5 years, Chinese buyers are again looking for meat products on the European market since their imports from the US are getting to expensive and we have tons (in millions) to sell them, if we balance exports and tourism with energy price hikes I say let it slide down to 90, 95.

I don't know why everyone is focussing on the 1.5 rates when in reality for the last 8 years the euro hasn't been stronger than 1.25 and that just because the US was really in trouble.

Didn't think that if Euro's performance was increasingly down, experts said that inflation that occurred in a very high Euro user country made the Euro position more declining, if the war with Russia did not end soon then I was sure that in 2 years Euro would be half of the dollar.

Certainly, it's better than going below $1but the condition is exasperating. I really hope that it doesn't crash any further, it's deteriorating an already desperate situation. Inflation is still rising, a further drop in $/€ rate of exchange would be disastrous, especially for oil prices, which are showing minor signs of relief.

You have a point and from what I am seeing due to the habit of Putin I don't think the Ukraine invasion will end soon. Besides, another country seems ^{9which I currently forget the name appears to be preparing for Putin's possible attack)} . I just hope the Russian government will put aside the political different and make peace with their neighboring country because the impact of the war on the EU economic is huge.

Peace is the key to the economy, if there is a war then sooner or later it will have an impact on the economy including from countries that are not directly involved, this is the importance we must always invite the russian government to make peace with humanitarian reasons and the impact of war will be felt for a long time.

May not be in 2 years, but very possible in 10-15 years. The advantage with the United States Dollar is that it is the reserve and trade currency of the world. Americans are able to take loans, paying a measly interest rate of 1% or 1.5% per year. And the treasury bonds are mopped up by those who are looking to preserve their wealth. This means that other currencies in the long term will go down in value against the USD. It is a chain reaction. The more bonds are purchased by non-US investors, the stronger will be the value of USD.

It is not advantage, it is the only reason why USD has value, otherwise it would turn into the weakest currency in the world below Venezuelan Bolivar. Of course it needs most of the world dumping USD for it to become worthless and that's not going to happen in short time.

These days more than half the world is coming up with their own reserve and trade currency. As more countries join BRICS and dump USD, it will only lose value. If you look at Ruble it is soaring against USD simply because Russians dumped USD as trade currency in most of their trades. Lest we forget last time Europeans dumped US dollar, it tanked hard and lost more than half of its value.

This is not good news my friend. When I was still in Jr school, I remember always watching the UK news channel and I was influenced by their currency to the point that anytime I hear arguments between Euro and Dollar, I always volunteer until I beat the opponent, the joy was there till this moment it loses it parity with dollar due to ongoing crisis that is going on right now in the UK. There is the Food crisis, high inflation and recession and isn't helping and this has helped me understand what has been holding the Euro all this while.

Theoretically, this should be bullish for bitcoin but the same factor is making investors sell their assets to prepare for the worst, nobody wants to stay hungry during the food crisis in a recession.

What if Russia starts trading oil and gas in Ruble. I think Russia is not scared of sanction and ban. They know they have power and they can go to any extreme to bring back their power. They have the most Nukes and they can fight any superpower - let's not take Russia easy.

Oil has been extremely volatile the past few days, Brent Oil was worth $110/barrel yesterday afternoon and a few hours later it had crashed to $104, quite a difference. Can't understand what caused such a drop. While gas prices have slightly dropped, it's still too expensive for the average consumer. On top of that, the current rate of exchange of EUR/USD is trending at $1.02/€, increasing the fueling costs even further.
Edit: Grammar

This oil and gas problem is putting the whole world in so much trouble.
We are all at the verge of nervous breakdown due to inflation and trouble COVID and Ukraine war has created.

The US dollar strengthened slightly and the euro continued to weaken. Inflation and global recession continue to worsen all sectors of the economy in various countries and the eurozone is under pressure from this and even the weakening of the euro is also caused by one of the factors, such as increasing concerns about the possibility of a recession in 19 eurozone countries. even according to some surveys found that business growth in the euro zone is slowing down. and that could cause the entire region to fall into recession. and many other factors as mentioned by other members above.

1 usd = 0.98$

Usd is one of best performing currency these days thanks to stupid moves by Europe of boycotting cheap Russian gas. While usa is the biggest beneficiary of ukarine war while loosers are EU along ukarine and Russia. EU and Russia must sit and find a peaceful solution.

I see that the price of the euro will definitely be less against the dollar, since Europe will probably have to pay for the benefit of other countries. What does it mean? Probably many people know about the problems in the United States, namely in their economy and finances, and so this all needs to be resolved and it has already been found, namely, the ruin of Europe will just allow the United States to help solve its problems at this stage in the first place. Based on this, the price of the euro against the dollar will continue to decline.

As long as EU is doing stupid mistake of boycotting cheap Russian gas rather buying expensive USA LNG they are deemed for destruction. There is energy crisis be expected in few months. Meanwhile Russia is selling his oil to New markets found in China and India.

USA could be in trouble eventually, but the fact that Europe is a whole continent and the nations that are using euro are not all single entity. Meaning if we are dealing with this right now, that means we are not going to be shocked when Germany fails to pay for the debts of Greece or something like that again. We have known for a while now Germany has been fixing the problems all over every nation that uses euro, and France tries to not create too much trouble for anyone, but there are like a dozen nations that is failing and because of that euro is failing as well and now that Germany can't make a surplus, they can't reach out and help everyone all at once.

USA is big enough to be like Europe continent as well. The difference is that instead of nations, they have states and each state is managed by itself aside from federal law. Meaning that while California is paying a ton more taxes and getting a lot less in return by federal government, alamaba would be paying nearly not enough and then get a ton of federal help.

If we were to tell alabama to collect their own taxes and live, they will bankrupt in a minute, which is the same situation. Maybe Germany bankrolled Europe so far, but California and New York type of places bankrolled many states so far as well. If USA can survive that way, Europe could survive the same way as well.

Since when is Germany saving other countries from the goodness of their heart? Are you serious? Germany made billions, profiting from Greece's financial crisis. The ECB is responsible for the state of many countries in Europe, including Italy, Greece, Spain and so on. Not to mention that Germany still owes war reparations since World War 2.

No one is saving anyone, it's all done for profit, Greece and many other countries should have never joined the Eurozone, it was a terrible mistake.

Let's see how the USD behaves during next year, but it is very clear that the US economy has come out of the covid with just a bit of a cold meanwhile the EU economy has come out with a full blown flu. The jobs market in the US is extremely strong, and despite a technical recession, there is not a translation into the public confidence... inflation is high because people keep spending like crazyl

I don't see how it is very clear
The US GDP has gone down 1.6 in Q1 and again 0.9 in Q2, EU's GDP has grown by 0.6 and 0.7 in the first part of this year.
If we look at employment the US has a labor force participation rate of 62.1%, below the 63.4% before the Covid disruption, Eu has reached a record of 74.30%, and since it's a record it's obviously above 2019.

So, who has the flu and who has a cold?

I think you are very optimistic with these statistics. Personally, I have little confidence in statistics, as it is not unusual to see two economists arguing the opposite on the basis of statistics, sometimes on the basis of the same studies.

Apart from the fact that in these cases I always remember the personal text of DdmrDdmr:
There are better things in Europe than in the US, obviously. For example, I think it is positive that in Europe there is less difference between rich and poor, but I don't think that the situation in Europe at the moment is something to boast about. And I hope I'm wrong, but the future looks bleak.

If you have little confidence in statistics then what do you believe?
Random twitter accounts that have predicted 100 crashes, war nuclear destructions, and famine? Or let me quote :


The data is there, it's no statistics that can be misinterpreted in both ways, like for example unemployment in Belarus, where of course nobody signs up for unemployment benefits because they pay 2$ a month. This is an actual number of people employed, with contracts with wages.

And if you're from Europe you can't possibly deny that everyone is hiring and nobody has enough workers right now, it's not a crisis where people can't find a job, everywhere you go there is a job opening.
You're from Spain, are your beaches empty? Are the hotels empty? Or do you see surging numbers of tourists partying all night?


I'm not boasting about anything, I'm just saying that despite all the doomsday rumors spreading around here, where everything in the economy is going to collapse since we need the world to be destroyed in order for Bitcoin to thrive on our corpses, things are not that bad!
Of course, they could be far better, but it's nowhere near the level some want to paint.

Affected by headwinds such as high energy prices and deteriorating global terms of trade, the euro faces further inflationary pressures, while the euro zone's economic growth prospects are weakened. And expectations of faster and bigger Fed rate hikes boosted the dollar.

The unemployment rate in Spain is around 12.5%, which for Spain is not bad, but it must be taken into account that the current government made a reform on some type of job contracts (fijos discontinuos) that allows some people to be counted as working for the whole year when in reality they only work for a few months.

Nor is someone who is unemployed and does some training useless courses counted as unemployed, and there are other examples like this that show that the unemployment rate has a lot of statistical make-up. I'm not just saying in the case of this government. Statistical make-up to mask the pathetic state of the labour market in Spain has been used by various governments over the years.

That's why, among other things, I say that I don't trust statistics.


We are back to the same thing. Isolated data does not indicate anything. Hotel occupancy as a % is an indication, but it is no good having a hotel occupancy rate similar to the average if spending per tourist is significantly lower, to give an example. You can go to the beach without spending a euro, you take the car, a towel and a cooler for drinks and food. So full beaches are not a reliable indicator of good economic activity either.

And why are mentioning this?
I've already told you I'm not looking at the unemployment rate that can be manipulated in one hundred ways.
What I'm looking is the employment rate which simply means one thing, people who work versus all of the population capable of working.
https://ec.europa.eu/eurostat/statistics-explained/index.php?title=Employment_-_annual_statistics


Not isolated data, overall data!
https://www.reuters.com/world/europe/spain-edges-closer-pre-pandemic-tourism-levels-with-75-mln-visitors-june-2022-08-02/

Covers everything you have tried to deny as an indicator, from the amount of spending money per person increasing to overall numbers of occupancy. Next? Don't you see that you want everything to be bleak as you are trying to find fault in everything good?
Do you see how you dismissed my claim about tourism without bothering to check the numbers or anything else and then you claim you don't trust things, how can you be so bent on not trusting things others say when you don't verify your own beliefs?

Hey man, have you read the article? Yeah, increasing numbers of occupancy compared to the 2020 and 2021. And yet:
So you call data to rely on the forecasts of the Spanish government, which is widely known for its predictive reliability in economic matters. Is that it? LMAO.

You can see it as the government sees it or you can see it as we have 10% less tourism, than pre-covid.


Yes, this indicator is more reliable than the one usually used in Spain, which is the unemployment figure.

If you mean that the situation is not catastrophic as you said before, we agree on that.

Do you see the future looking very bright with rising energy costs and the regulatory tangle in Europe?

Have you seen the evolution of the Euro Stoxx 50 versus the S&P 500 over the last 20 years? Do you think the next 20 years will be better for us?

Although after the last bill passed by the US Senate, I don't see much stimulation of economic activity there, but perhaps that's what the planet needs:

US Senate approves Biden’s climate and tax bill: ‘This is going to change America for decades’ (https://english.elpais.com/usa/2022-08-08/us-senate-approves-bidens-climate-and-tax-bill-this-is-going-to-change-america-for-decades.html)

So right now, from the crisis, people losing their jobs, gloom, and doom you're last defense is that we're at just 90% from pre covid levels?
Lowering the bar much?  ;D


Ok, I've got it.
You don't like data at hand but you think 20 years in the future and you say it's definitely bleak.

Furthermore, at this point, I don't understand what are we even debating, my first post was clear, I asked paxmao if he is sure who has the flu and the cold, I've never said one could run the marathon and the other has cancer, and you only argued about not believing statistics.
If you don't believe any number cause is coming from the evil gubbermint that banned tinfoil hats, then how would it be possible for me to convince you of the opposite? At this point there is no way, I can throw any data at you and you will say no it's not good, so all that it's left is to wait for 20 years and see who was right and who was wrong.

Neither do I.


No. That the Spanish government says we will be at 90% of pre-covid levels. There is an important difference in nuance. Look at the economic predictions made by the Spanish government and see if it has got any of them right.


The data at hand shows that over the last 20 years the performance of the Euro Stoxx 50 is laughable compared to the S&P 500. I don't know what you are talking about when you have the data in front of you and you don't pay attention to it.

I have no reason to believe that the next 20 years will reverse the situation shown in the data. That's the point.

And another thing coming back to the main point of the thread. The euro has not only weakened against the dollar. It has weakened against most of the major benchmark currencies as well. Look at the data against the GBP, the Swiss Franc or even the Yuan.

I do not understand why the Euro value continues to decline, not only corrections to the USD but almost all currencies, this is an indication that the British decision not to join the European economy is the right decision, it must be recognized after Europe uses a single currency.

You should have looked at the British Pound's exchange rate before making this statement. Both GBP and EUR are dumping identically (both about -3% in past month). In fact this is the main reason why the English government fell apart and Johnson was kicked out of office. Brexit failed to achieve its goals.

I think, Europe government is seriously working to end the crisis that is affecting their economy and other things in the country. Europe are still struggle to recover what COVID-19 has caused in their financial assets that is making their citizens not to make enough income from their investments, which is causing their government pain to do everything possible within their power to improve their economy before the end of this year 2022. I don't think, this economy depreciation will continue in Europe because their government is planning to print more money that will make the economy to increase higher.

The euro made big news in July 2022 when it fell to the same value as the US dollar for the first time in two decades. It hasn't recovered much -- after an expected dip of the dollar on Aug. 12, one euro is still only worth $1.03. That's down from $1.18 at the end of Aug. 2021, or a 12.7% drop.

It's not simply that the euro's falling, however. The dollar has been rising due to higher interest rates and global economic uncertainties such as the war in Ukraine.

After several weeks of the exchange rate of EUR/USD trending at $1.02, today it crashed even further and practically achieved 1:1 parity. It's currently at $1.0037/€ and wouldn't be surprised if it went even further below. A few weeks ago, some users mentioned that we could also see Euro falling below $1 but many of us thought that it was too extreme. I hope we're not proved wrong.

Today it went down breaking parity. A moment ago it was at $0.98 per euro.

We will see how it turns out. In principle, many things will be more expensive for Europeans in the Euro zone, starting with the fact that raw materials are paid in dollars and this has repercussions on the rest of the chain.

As in everything else, those who have investments will be spared or will not notice it so much, because apart from the fact that well-made investments give returns higher than inflation, those who have a fund indexed to the S&P 500 or the MSCI World will benefit from this rise of the dollar against the euro.

The more countries that dump US dollar as trade/reserve currency the more Euro is going to dump! It's based on the fact that dumping US dollar sends back trillions of dollars that were printed without anything backing them that will cause high inflation and weaken US dollar.
But they were sneaky enough to find ways to export that inflation, where is better than Europe to export it hence the dumping Euro.

On top of that we have Europe's economy that depends on energy prices being low and their services being bought. Energy prices are rising and they are losing customers for their service-based economy. Obviously Euro loses value.
1 more month and the temperature will start dropping too while energy crisis worsens in Europe. We can easily expect a much lower exchange rate.

Are you sure about that? I searched for a while, but can't find a point where it reached $0.98/EUR. It seems to be falling slow and steady, if it continues like this, it won't take long to reach $0.98/€. It's currently trending at $0.9916/€, while previous user's predictions about reaching $0.90 - $0.95 sound way too realistic now. If that happens, we're bound to see an increase in fuel again, which will spark an additional row of price increases to everyday goods, boosting inflation once again.
https://i.ibb.co/TWm2vF8/eurusd.png (https://ibb.co/sWyRmMw)

I count a $0.20 drop since September 5, 2021 (from $1.19 to $0.99).

Meanwhile, the interest in the EU is still 0.00%. Central banks deliberately destroy the value of the euro to keep the southern countries afloat, which isn't their mandate.

It's terrible. 1 dollar is almost the equivalent of 1 euro, because of the recession. The European Central Bank (ECB) has raised its key interest rate. After the first 0.5 percentage point move in July, more will follow. That was thought to reduce the effects of the recession, however, the immediate effects of a rate hike were not felt, according to IW. On the other hand, the ECB's intervention may even increase the risk of a recession. "Stagflation is a real risk in Europe," this will continue, if covid and this war passes maybe the recession in Europe will ease.

The opposite is true: increasing interest will increase the chance of a recession. But negative interest isn't normal, and so are recessions. What's not normal, is devaluating your currency and continuously "stimulating the economy".

We've had negative interest for years, you would make money by getting into debt. This was never even acknowledged in economy books. If you went to college, teachers wouldn't teach you about this ever happening. It has happened for the last decade. Now we are going to get into a recession since they will have to go into higher interest rates. The more they delay the interest hikes, the more brutal the crash. If they do it slowly, it will be a long term recession. I think we may see a rise on the SP500 since they are scared to raise the rates. This will make the investors confident, and thus will create a massive crash. Michael Burry is right, we haven't capitulated in my book.

Would you care to explain what you mean by this? specially the part of  "southern countries", since I am not informed enough on the economic policies within the European Union, I just get a look at the news.

Also, I thought there was a plan or the possibility to increase the interest rate in Europe was being discussed, since USA is already doing it in hopes to decrease their inflation rates, it sounds almost reckless the Eurozone is not doing something so their currency can remain competitive.

What am I missing?

Short version: ECB can't increase the interest to the level it should be, because countries in the south wouldn't be able to pay their debts and risk bankruptcy.

LOL.. the EU at this point reminds me of the USSR of late 1980s. The real reason why the USSR collapsed was that the "parasite" states such as Tajikistan and Uzbekistan grew in population and demanded more funds and resources from the productive states such as Russia and Belarus. EU is in a similar situation. Countries with budget surplus, such as Germany and Netherlands are funding less productive states such as Poland and Greece. And now the issue is that Germany will no longer have a budget surplus, thanks to their stupid policies in the Russo-Ukrainian war. 

There's a reason it has been called EUSSR by many people (including theymos).

I love when the guy that claims a month has 40 days and 3x7 is 30 is suddenly after being a military, politics, master historian turns to be an expert on EU economics. Of course even more amusing is that the only people really concern with these are the ones not living in the EU, and strangely rather than focusing on their own country they find fault with others, so let me get this right for you

India has exported $418 billion for the first time in its history. This is more than the target.
 (https://www.livemint.com/economy/indias-merchandise-exports-reach-417-8-billion-in-fy22-11648996216510.html)
Poland exports for 2021 was $410.54B, a 22.47% increase from 2020.
 (https://www.macrotrends.net/countries/POL/poland/exports)

So this parasitic less productive state of Poland with just 40 million people has managed to produce and export more than the whole of India. Now, looking at the 1:30 population ratio, how would you call "productivity" in India?


I find it interesting that most of the ones calling it like that are the ones that have never actually lived a second in the actual USSR.  ;)
The ones that did know this is just bs.

It was a mistake. It was like 0.9908 or something and I miswrote it.


No. The interest in the EU is 0.5%. I'm surprised you would say that, but at least it shows that you are human and make mistakes too. Or maybe it's your mobile alt, which is not so focused.

https://tradingeconomics.com/country-list/interest-rate?continent=europe

Eurozone raises interest rates for first time in 11 years (https://www.bbc.com/news/business-62240730)


Yes, of course, that's an exaggeration, but I think you and I have pretty similar ideas about economic policy, although I don't think the EU's regulatory voracity is the best way to stimulate business and economic growth. I see it as very socialist, although Europe has always been more social democratic than the US for example (at least since the end of WWII).

I would not call the EU Bolshevik, but it is quite socialist.

The increase in the key rate was carried out as part of the fight against inflation, but the problem for the euro is that it does not work that way. If you want to curb inflation, you must first raise the key rate sharply to a level above the current inflation rate, and then implement a series of key rate cuts to stimulate the economy. And if you smoothly raise the key rate by a value that is obviously an order of magnitude smaller than the current inflation rate, then you only stimulate stagflation, that is, inflation growth against the backdrop of a decline in business activity. You don't need to graduate from the Higher School of Economics to understand this.

No it's not :P It's literally in your own link:
That means the interest went from -0.50% to 0.00%.

I think the term "EUSSR" comes from the EU striving to become bigger and more powerful, trying to decide everything. They don't seem to care about what people vote, and go their own way anyway. And they have a long history of taking really good care of themselves, up to the point where they only showed up at work to collect their daily allowance. Those things don't look good when it hits the media.

In the media, they call the increase to 0.00% a really strong effort to fight inflation. That says it all, it's ridiculous!

What else is there to do but believe in the power of verbal interventions? A sharp increase in the key rate to the level of inflation will be a disaster for Greece and Italy in particular and for the European Union as a whole.

I mean they are trying to build a whole union from many different nations and cultures into just one system... wouldn't be really weird to see them as USSR because that is literally what they did as well. Look at all the nations USSR had under its banner at that point and see that we are talking about way too many different type of people and cultures all under the same flag which caused the turmoil and problem eventually.

Same goes with Europe, Germany has done very well, Greece hasn't, that much is known globally right? Well there are many that did well and many that did poorly not just those two and the idea to stay together can't work like that.

Now they're just delaying the inevitable, while the low interest and high inflation are damaging the economy, savings and pensions. I'd much rather rip off the bandaid, get rid of zombie companies that can only exist with low interest, and rebuild a stronger economy from there.

I think a recession has occurred in the EURO currency, which was previously well above the USD price. If Russia's war with Ukraine continues, there is a possibility that some countries will experience inflation. In this case, the US is in a safe position, because they have a strong economic resource through trade in war weapons. While Russia is also in a safe position, they have a source of income from oil sales. What about countries - countries that depend on other countries. Maybe the third world war hasn't happened yet, but it's already in the discourse. So that the economic crisis will continue to occur, and the world community will become victims of the political games of several countries.

Well, you are right (that is, you are not human :) ).


The thing is that the first link showed the Euro zone countries with 0.5% but I have seen other sources and I see that the "increase" was from -0.5 to 0%. Lol. So things are worse than I thought. And that the ECB's main theoretical mandate is to keep inflation contained but it doesn't seem to be what they are most concerned about right now.


Yes, by wanting to regulate everything.

I know it's been a while, but I wasn't tracking the EUR/USD exchange rate. It recently reached its lowest level in over 20 years, with an exchange rate of 1 EUR/0.954 USD. I didn't anticipate it to fall by that much, going well and beyond under $1, and although there was a small recovery today, things are still looking pretty bleak. On the plus side, the price of crude oil and natural gas has dropped significantly over the last week, providing some small relief at gas pumps and in the energy exchange market. Although I haven't seen any significant drop in gas prices, it's still a little encouraging that prices are not increasing any more.

This is putting a huge strain on the European economy while the situation in Ukraine with the recent Putin threats doesn't look too positive.

Reminds me of the recent statements from Führerin Ursula von der Leyen regarding the Italian general elections. She blatantly claimed that Italian people will face "consequences" if they elect the center-right coalition led by Giorgia Meloni. And still, it is Russia who get accused of meddling in the politics and elections in other countries. I never heard Putin making similar comments about "consequences". And despite all the threats from the Führerin, Italians elected Meloni with a large majority. 

5 years ago the euro position 20% higher in comparison with USD. The exchange rate in my country is currently the dollar is about 8% higher than the euro, many analysts are worried that the decline in the euro will have a big impact on the world economy, many say that the control of the European Union with the euro is too weak to make its value continue to decline.

Since on the other topic, we were talking bout the death of the dollar I remembered this gem!   ;D
So what happened, did we again fail to kill the Euro and the Eurozone?

https://talkimg.com/images/2023/05/20/blobe3050e1557f1b705.png
https://finance.yahoo.com/quote/EURUSD=X/

Were all the fearmongers and the illiterate who have never set foot in Europe or can't even pinpoint it on a map wrong again?

Seems like the Euro is back where it was one year ago, the ECB hasn't destroyed the economies or skyrocketed the debt to unpayable levels, no crushing unemployment, and the economy has kept growing even adjusted with the inflation, so what conclusions should we draw out of this?
Maybe not everyone is cut to be an analyst or an economist. Just saying!

No matter in which way you want to spin it, the long-term outlook for Euro remains bleak. And there is a good chance that USD will overtake EUR once again in the near future (this time permanently). For the last 1-2 months, crude oil has gas prices have remained low, and this has allowed the EU to lessen the trade deficit. Just wait until the prices go back to the levels we had in October. As long as inflation rate in Germany remains in double digits, EUR will continue to weaken against currencies such as USD, GBP and CHF.

It took me a while to realize that the euro has recovered this much; I actually saw it a day or two ago and I had completely forgotten about this thread. Still, it's way lower than it used to be a few years ago, when it was usually ranging between $1.18 and $1.20 per euro, but it's still an improvement for the market. I was actually worried and frustrated when the euro went as low as $0.98/EUR, and it did get me thinking for the worse. Fortunately, it seems that the crisis has been averted, although it could have been a great earning opportunity for those who were willing to take the risk of exchanging currencies back and forth.

Truth is USD has gained value over most currencies in the past year and at its peak the exchange rate from USD to EUR was about 0.99 and USD had gained about 14% over the euro in the past year alone. So in a way holding USD was an "investment" if you held it and traded some of your USD into EUR like I did but this is only useful if you have EURO bank account and plan on using that money. Or you can just hold it exchange it back into USD later.

Look at the quotes - everything is back almost to the pre-COVID state. The pandemic was the first blow that caused many major economies to collapse and governments to print a lot of money to provide an acceptable standard of living for the population. The second blow was the terrorist war unleashed by Russia in Ukraine, and then the economic terror of the EU, I'm talking about oil and gas terror and attempts to manipulate the market. But the world economy is on the mend, the markets are "aligning", the situation is returning to its place. Yes, the global market will not return to a full-fledged normal state "tomorrow", but I think that in 2-3 years, all the consequences will finally disappear. And the euro dollar balance will be within the framework of profitable parities for the two most powerful economies

You should really check the dates of the OP in a topic before replying, maybe things have changed dramatically from when this topic was opened.
The dollar has lost ground against the Euro in the last year, so in a yoy period the euro is 6.25% against the usd!

https://i.ibb.co/Y0npSXN/62208909.png

So next time, put more effort into double-checking what you post, rather than making sure how much mandatory text you post!

But this topic is quite nice, after pages of enthusiasm about the Euro dying, now that is back at the same value, the panic is gone, and the EU is not freezing or crumbling the whole topic has gone empty. And there were so many marvelous predictions here about how it will become useless...

The situation in Ukraine, with the ongoing conflict and tensions with Russia, is also a major concern, as it has the potential to disrupt energy markets and geopolitical stability in the region. It is important for policymakers and stakeholders to carefully monitor and respond to these developments, in order to mitigate the risks and promote economic and political stability.

There are number of factors those can affect exchange rate of any currency, such as inflation, trade balance and political stability. Given the current global economic crisis, the value of Euro relative to US dollar  may continue to decline, however it is also possible that situation could potentially reverse in future. I believe the key factor influencing the Euro depreciation against dollar is high prices of Gas and crude oil. As European union countries heavily rely imported crude oil for their energy requirements, rising prices of petroleum product can lead to increased inflation and devaluation of currency.

A few days back there was a lot of difference between the dollar price and the euro price. What is the impact of the war in Ukraine and Russia behind the fall in the value of the euro?  Currently, demand for dollars has increased globally compared to euros. Global demand for the dollar has increased the value of the dollar, which is now felt in the euro.  And in our country too, the value of the dollar has increased by several times in the space of a few months. The way the euro has fallen, if it continues to fall like this, the euro will soon fall below the dollar.

Indeed, looking back a few pages, you can see that there were quite a few replies claiming that the euro could possibly be coming to an end with an even larger drop. In the end, nothing happened, and the euro has recovered to almost pre-Covid levels. One euro is currently worth 1.12 USD. It's still far from what it used to be, but it's certainly a huge improvement from what it was a few months ago.

Although this is an interesting topic, I keep seeing new replies coming in that are completely irrelevant and not up to date with what's happening; thus, I might as well resort to locking this topic if it continues like this.

The Euro currency is negatively impacted by various economic factors such as high inflation rates across the continent, as well as geopolitical tensions such as the ongoing conflict between Ukraine and Russia. Additionally, frequent shifts in the political climate also contribute to the currency's instability.