Euro Drops to a 20-year Low Against the Dollar

The Eurozone’s common currency fell to its lowest level on Tuesday versus the dollar in two decades as a new spike in gas prices in Europe heightened recessionary fears.

Prices across the EU have risen as a result of the economic effects of the war in Ukraine, and economic development in the Eurozone has stalled.

The euro’s exchange rate with the dollar, in a report by CNBC, dropped as much as 1.3 percent to $1.0281, which is the lowest level since December 2002.

The decline fits into a longer-term trend; this year, the euro has lost 8% of its value against the dollar, which hasn’t happened since the 1999 introduction of the euro.

Euro-related currencies like the Polish zloty, the Romanian leu, and the Hungarian forint have all declined significantly versus the US dollar.

The European Central Bank informed the markets in advance of its intention to raise interest rates for the first time in 11 years at its July meeting as a result of the record 8.6 percent inflation rate in the euro zone in June.

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