U.S dollar almost equal to Euro

[adaseb]

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.

[Poker Player]

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

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.

[DanWalker]

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.

[el kaka22]

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.

[darkangel11]

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

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.

[Webetcoins]

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.

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.

[Poker Player]

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.

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

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 paints a very dark future for the Eurozone.

[Ultegra134]

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


The current rate is at 1.0040 EUR/USD, and lit's falling as we speak. Things are not looking good.

[Poker Player]

And the Euro is pretty much equal to the USD now.

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.

[Spack17]

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.

[LoyceMobile]

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.

[stompix]

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.

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.

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.

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?  

[LoyceMobile]

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.

[stompix]

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? 

[Webetcoins]

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.

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

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 paints a very dark future for the Eurozone.

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.

[Hydrogen]

Goldman Sachs warned that the Eurozone is on the edge of recession

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.

[stompix]

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.

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... 

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

It might be safe to say, europe has been on the verge of recession for quite some time.

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!

[Sithara007]

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.

[Poker Player]

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.

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 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.

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!

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.

[Zilon]

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