The euro fell to its lowest level in two decades on Tuesday, sliding over 1% for the session to hit $1.0283, CNBC reports.
It comes as fears of a recession in the euro zone ramp up, as gas prices soar and the Ukraine war shows no signs of abating.
Euro zone inflation hit a record 8.6% in June, prompting the European Central Bank to give markets advance notice of its intention to hike interest rates for the first time in 11 years at its July meeting.
However, growing fears of a recession may limit the central bank’s capacity to tighten monetary policy.
The July Sentix Economic Index on Monday showed investor morale across the 19-country euro zone has plunged to its lowest level since May 2020, pointing toward an “inevitable” recession.