The euro fell to its lowest level in 20 years on Tuesday, as European concerns about energy supplies and economic growth intensified. Meanwhile, the dollar rose against major currencies, supported by inflows into the currency, which is considered a safe haven.
According to data published by Reuters, the euro reached $0.9909, its lowest level since late 2002, and was last down 0.29 percent to $0.9914.
Morgan Stanley expects the euro to fall to $0.97 during the current quarter, a level not seen since the early 2000s, Bloomberg reported.
Nomura International is targeting $0.975 by the end of next September, which means the market may be looking for $0.95 or less, as energy supply constraints increase the risk of power outages and are likely to boost euro imports.
Russia will halt natural gas supplies to Europe via the Nord Stream 1 pipeline for three days at the end of the month, highlighting the continent’s precarious energy situation.
Heat waves in Europe have already put a strain on energy supplies, and concerns are growing that any disruption during the winter months will be detrimental to business.
