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The euro fell to a 20-year low

The euro fell to a 20-year low, world agencies report. After the latest rise in gas prices in Europe fueled fears of a recession, the European single currency also depreciated by more than 1% against the US dollar. The depreciation of the euro took it to its weakest level since late 2002, with the currency trading down 1.14% to $1.0302 as of 1:50 p.m. Bulgarian time.

Against this background, the Japanese yen was again near a 24-year low and the Norwegian krone fell 1.2% after gas industry workers went on strike. The Australian dollar fell 1% to $0.6787 after trading at $0.6895 earlier in the day. Since the beginning of the year, the currency has fallen by almost 7%.

The head of global markets research at MUFG, Derek Holpenny, commented to Reuters that “the risks of Europe slipping back into recession appear to be growing after another 17 percent jump in natural gas prices in Europe and the UK.”

Concerns about how the European Central Bank will react weighed on sentiment after Bundesbank chief Joachim Nagel attacked the ECB’s plans to try and protect heavily indebted countries from rising interest rates.

ECB: Banks to bear in mind the possibility of a recession

An interruption of Russian gas supplies would worsen the economic situation in Europe


“It will continue to be very difficult for the euro to rise significantly given the deteriorating energy picture and the significant increase in risks to economic growth,” Holpenny said.

Eurozone inflation reached a record 8.6% in June, prompting the ECB to raise interest rates for the first time in July – for the first time in 11 years.

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