Rising energy prices are a drag on the euro. Therefore, the Commerzbank economists expect EUR/USD to remain below parity for now.
Considerable risk for the euro if the upward trend in energy prices continues
“The increase in prices in the energy markets and, therefore, the negative effect on the euro is still limited. But there is a considerable risk for the exchange rate of the euro if the upward trend in energy prices continues. energy, in particular it would be critical for the single currency if price levels like those seen in the middle of the year were to be reached again.”
“For the time being, uncertainty around the European energy crisis is likely to remain high, so the EUR/USD exchange rate is likely to trade below parity, rather than above it, for some time.”
Source: Fx Street
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