On Wednesday (August 24), the opening price of the euro and the dollar was 1.1766, the closing price was 0.9968 yesterday, and the temporary report was 0.9945, a decrease of 0.24%. Under the shadow of the energy crisis, the euro zone economy has been exhausted. The euro zone composite PMI has been below the line of prosperity and decline for two consecutive months, and the risk of recession is imminent.
The impact of the energy crisis on the euro area economy is comprehensive. From the demand side, rising energy prices will lead to higher living costs and lower disposable income. From the perspective of production, the shortage of energy has increased the production cost of enterprises, and many enterprises have been forced to suspend or reduce production, and industrial output has declined. The decline in industrial production and sales capacity will affect the growth of enterprise employment and residents’ income, further restrict consumer spending, and make the economy fall into a vicious circle. At present, due to geopolitical, weather and other factors, the energy shortage in the euro area shows no sign of easing for the time being, and the energy crisis will continue in the second half of the year.
Overall, recession in Europe is a foregone conclusion, and winter will be tougher. While the euro zone’s economy remained positive in the second quarter, analysts worry that energy shortages will push record inflation further and push Europe’s economy into recession. The second quarter could be the “last growth” for the European economy.
EURUSD Technical Analysis
EURUSD hit a session high of 1.0017 in U.S. trading, but failed to hold above-par gains. Technical data on the daily chart shows that risks remain skewed to the downside as indicators have barely lost their downside momentum and remain in negative territory.