The euro crashed to a fresh 20-year low against the rampant US dollar yesterday.
On another turbulent day on the foreign exchange markets that saw the pound tumble, the single currency fell close to $0.97 for the first time since 2002.
It came as business activity in the eurozone suffered its biggest contraction in 20 months. S&P Global’s purchasing managers’ index, a key gauge of business conditions was 48.2, from 48.9 in August.
Crash: On another turbulent day on the foreign exchange markets that saw the pound tumble, the single currency fell close to $0.97 for the first time since 2002
That was below the 50 mark which separates contraction and expansion and the lowest reading since January 2021. ‘A euro zone recession is on the cards,’ said Chris Williamson, economist at S&P Global.
‘Germany is facing the toughest conditions, with the economy deteriorating at a rate not seen outside of the pandemic since the global financial crisis.’
The report underlined the devastating impact the war in Ukraine has had on the global economy as energy prices soar.
It is feared the eurozone, like the UK, is in recession. ‘Business activity has been contracting throughout the quarter,’ said Bert Colijn at ING. ‘This confirms our view a recession could have already started.’
