The euro depreciated below $1.03, its lowest level since December 2002 as weak economic data and rising gas prices strengthened the prospect of a widening monetary policy gap between the ECB and the US Federal Reserve. An energy crisis in Europe has clouded even further the outlook for growth in the Eurozone, making the ECB's task of taming record levels of inflation more difficult. The annual inflation rate in the Euro Area increased to a new record high of 8.6% in June of 2022, once again above market expectations. ECB President Lagarde said she believes it is unlikely that the Eurozone will return to an environment with low inflation while confirming a 25bps rate hike in July after multiple ECB policymakers called for a steeper increase. Conversely, the Federal Reserve is expected to continue with fast rate hikes and raise the fed funds rate either by 50bps or 75bps this month.
Historically, the Euro Dollar Exchange Rate - EUR/USD reached an all time high of 1.87 in July of 1973.The euro was only introduced as a currency on the first of January of 1999. However, synthetic historical prices going back much further can be modeled if we consider a weighted average of the previous currencies. Euro Dollar Exchange Rate - EUR/USD - data, forecasts, historical chart - was last updated on July of 2022.
The Euro Dollar Exchange Rate - EUR/USD is expected to trade at 1.03 by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate it to trade at 1.00 in 12 months time.