Euro falls below one dollar for the first time since 2002

Frankfurt An impending recession in the euro zone and the growing interest rate differential with the USA caused the euro to slip below one dollar on Wednesday. The common currency fell below parity for the first time since 2002, costing just $0.9997.

The latest inflation data from the US has fueled investor speculation that the US Federal Reserve will aggressively raise interest rates again. At 9.1 percent, inflation in the USA in June was significantly higher than expected compared to the same month last year. Economists surveyed by Reuters and Bloomberg had only expected a value of 8.8 percent.

“As of today at the latest, the US Federal Reserve has received new arguments to keep up the rapid rate hike cycle,” said analyst Timo Emden from Emden Research. “There may not be much to stand in the way of another XXL interest rate hike at the central bank meeting at the end of the month.”