The euro and the U.S. dollar are equal for the first time in 20 years, as Russia threatens to cut off gas to the west and inflation rates soar, sparking fears of a European recession.
The euro slipped as low as around $1.00005 Tuesday morning, but has since inched up to $1.0061.
Greg McBride, chief financial analyst with the New York financial company Bankrate, told Forbes the effect on imports and exports will be relative, increasing the cost of American goods sold in Europe while making European goods cheaper in the U.S., helping to ease the effect of rising inflation.
“Going to Europe looks a lot cheaper to Americans compared to last summer,” Moody’s Analytics chief economist Mark Zandi told USA Today on Tuesday, noting a stronger dollar can offset the cost of rising airfare by 10% to 20%.
By Brian Bushard via Forbes