The euro sank to its lowest level against the dollar since April 2017, weighed down by supply concerns after Russia announced its energy firm Gazprom will suspend gas deliveries to Poland and Bulgaria.
The common currency fell 0.2 percent to US$1.0616, exceeding the low reached in the early weeks of the coronavirus epidemic in March 2020, following Russia’s announcement that it would cut gas to Poland and Bulgaria. There is now a possibility that the euro may finish April below its 20-year uptrend.
Gazprom, Russia’s state-owned energy company, announced on Tuesday that it will suspend gas supplies to Poland and Bulgaria from Wednesday (April 27) due to their refusal to pay in roubles, an apparent warning shot to the rest of Europe.
The dollar’s rapid rise and Russia’s weaponization of energy exports add to the currency’s headwinds, as does the European Central Bank’s comparatively cautious approach on tightening monetary policy in comparison to the Federal Reserve, said Bloomberg.