The euro started the new week on Monday with gains. The dwindling fear of drastic interest rate hikes by the US Federal Reserve, according to leading central bankers, caused some confidence in the currency market. “This puts the interest rate specter in the background a little,” said analyst Jochen Stanzl from the online broker CMC Markets. In addition, recession worries abated somewhat. “There could now be some sort of collective sigh of relief among investors that the Great Economic Downturn may be a distant issue for the foreseeable future.” Against this background, foreign exchange investors cashed in on the world’s leading currency. The dollar index, which tracks rates against major currencies, fell 0.7 percent to $107.05. In return, the euro temporarily climbed by one percent to $ 1.0201. The common currency briefly fell below parity last week.
The oil price also went up. North Sea Brent rose 4.5 percent to $105.72 a barrel. For one thing, the dollar’s depreciation made commodities more attractive to non-US investors. In addition, during his visit to Saudi Arabia, US President Joe Biden was unable to get any commitments from the major producing countries to expand production, said Baden Moore, chief commodities analyst at Bank NAB. So the supply remains tight.
The gas crisis in Europe and the question of whether gas will flow again from Russia after the planned end of maintenance work on the gas pipeline “Nord Stream 1” on Thursday also caused uncertainty. Experts fear that Russia will not turn on the gas tap again after the work is completed in retaliation for Western sanctions. If that were to happen, Germany and other countries would face a recession. However, the European natural gas contract fell by 2.6 percent.