EcoTV Week

The euro at parity versus the dollar: causes, consequences and outlook

07/15/2022

The prospect of several rate hikes by the Federal Reserve, as well as the risk of disruption of gas supply in Europe and its negative impact on growth, are the main factors that have recently caused a depreciation of the euro versus the dollar, leading to a parity between the two currencies. The economic consequences are significant for the euro area and predominantly negative, the only positive one being a gain in competitiveness. In the short term, a change in direction is unlikely but in the medium term the euro should strengthen against the dollar.

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