(Finance) – The euro returns to pierce the parity with the dollar, for the first time since July 14. The single currency dropped to 0.9988 on the greenback earlier in the morning before recovering. Today’s weakness is affected by the prospect of blocking Russian gas flows from 31 August to 2 September announced on Friday by Gazprom. The announcement is again raising concerns that the link will not return to service as planned after the works, with very negative prospects for the European economy.
“Strong second-tier macroeconomic data and a decided rejection by FED officials against any notion of “dovish turn” they pushed US rates higher last week and this in turn strengthened the dollar – Ebury analysts comment – This week, PMI indices are released on Tuesday, as elsewhere. However, they are generally less successful in the United States. Markets will be looking at the PCE inflation report later in the week to corroborate the good news from the CPI report. “
The attention of international investors is also focused on Jackson Hole, a Wyoming town that returns to the center of financial news every late summer, for the Central Bankers Symposium. In particular, the President Powell’s Friday speech it could offer some clarity on the speed of upcoming rate hikes and its expectations of how high rates will need to rise before inflation is brought under control.
However, the strengthening of the dollar is not only against the euro. L’US dollar index, an index of the value of the US dollar in relation to a basket of foreign currencies, is trading at a high for the past forty days. The dollar index moves up by 0.14% to 108.3.