The relationship between dollar and euro exchange rate It is fundamental in the global economic sphere, since this factor influences international trade, foreign investment, raw material prices and the economic stability of the regions.
Understanding the exchange rate between both currencies is crucial for investors, businessmen and politicians seeking to make informed decisions in the international financial context.
In the financial sphere, the exchange rate is a key indicator of economic health. At the moment, 1 US dollar is being exchanged for 0.96535 euroswhile to obtain 1 euro requires 1.03590 dollars.
These figures highlight the dynamics of the economies that impact not only foreign trade but also investment and financial planning at a business and personal level.
The evolution of this type of exchange is especially critical for sectors that depend on the import or export of goods and services between these two regions, forcing a continuous review of strategies to mitigate risks and take advantage of opportunities.
The recent review of the economic forecasts of the European Commission by 2024 indicates a slowdown in economic recovery of the European Union and the euro area, adjusting expected growth rates to lower levels than previously anticipated.
For 2023, growth of 0.5% is now expected, with a slight improvement in 2024 but still below expectations previous. This slowdown is influenced by several adverse factors, including reductions in purchasing power and weaker external demand, although a gradual recovery supported by the decrease in inflation and a favorable work environment.
In relation to inflation, projections point to a more accelerated reduction than had been estimated, with a downward trend that is expected to continue until reaching more sustainable levels by 2025. This decrease is mainly the result of the drop in prices energy costs and less pressure on consumer prices in general, which suggests an economic environment on the path to stabilization.
However, the economic context is affected by considerable uncertainty due to external factors, such as continuing geopolitical tensions and the potential effects of trade disruptions, in addition to the associated risks to climate changes and extreme weather events. These factors could influence the projected growth and inflation path, adding an element of risk to the EU and Eurozone economic recovery expectations in the short to medium term.
Amid rising geopolitical risks and high inflation, the euro has proven to be a robust coin. 25 years after its launch, it remains the second most important currency of the international monetary system, second only to the US dollar.
According Consilium Europethe global preference for financing, loans and as a reserve for central banks, the euro constituted 20.5% of the foreign exchange reserves official globally in 2022 (adjusted for constant exchange rates), in contrast to 58.4% for the US dollar.
