The euro hits a low of $0.973 against the dollar, and analysts claim that the pound and other EU currencies are caught in a “doom loop.”

The euro, the official fiat currency of 19 of the EU’s 27 member nations, fell to a low of $0.9732 versus the US dollar on Friday. The decline occurs at a time when fiat currencies, such as the yen, yuan, and pound, have had difficulty competing with the dollar during the previous six months. According to analysts, the euro and pound are caught in a “doom spiral,” and the U.S. dollar is “the sole conceivable hedge” against a collapsing global economy.

Greenback Is the Only Haven in This Macroeconomic Environment, According to Citigroup Analysts

We are living in strange times in the financial sector, with fiat money, equities, bonds, and cryptocurrencies. The fiat currency of the European Union, the euro, has been suffering against the dollar on Friday, September 23, and has fallen below parity as the weekend draws near. The euro dropped to a low of $0.9732 during the morning trading sessions and is presently trading at $0.97. (10 a.m. ET). The euro has fallen more than 1% versus the dollar in the last day, and is now at its lowest level in 20 years.

On Friday, the euro lost more than 1% of its value versus the dollar, and several other fiat currencies, including the JPY, GBP, AUD, and CAD, are also declining. On September 23, 2022, at 10:25 a.m. (ET), a screenshot was captured.

The opinions of the Canadian Imperial Bank of Commerce and analysts from Citigroup Inc. were recently cited by Bloomberg authors Sofia Horta e Costa and Ruth Carson. The authors wrote last week that “the soaring dollar has led a lot of individuals to feel that the U.S. currency is the only safe haven asset.” Jamie Fahy and Adam Pickett, strategists at Citi, gave the group a research paper that covers the ephemera around the US dollar.

The Citi analysts assert that US dollar currency is the sole option for hiding. According to the financial experts at the bank, a “deep recession” will reduce inflation. The macroeconomic background, according to Win Thin, the chief currency strategy analyst at Brown Brothers Harriman in New York, appears to be in the dollar’s favor. The official from Brown Brothers Harriman stated that “the repricing of Fed tightening concerns is expected to keep the dollar bid across the board in the short term.” The currency strategy analyst at Brown Brothers Harriman continued:

Nothing essentially has changed since we mentioned it during the most recent dollar decline lower, and the overall global environment still favors the dollar and U.S. assets in general.

The euro and the pound sterling, according to TD Securities strategists, are caught in a “doom loop.”

The euro and the pound, according to TD Securities strategists, are caught in a “doom cycle,” and according to the company’s experts, things might become worse in the coming months. James Rossiter and the strategists at TD Securities explained the doom cycle on Friday, explaining that it is brought on by sluggish economic growth and rising energy prices.

The British pound will decline another 3% from present levels, according to TD Securities analysts. The European Central Bank (ECB) and the Bank of England (BOE) are limited in what they can do, according to Rossiter and the TD team.

The currency experts said that while “both the ECB and BOE aim to moderate and eventually reverse this cycle, monetary policy can only restrict the slowdown considerably ahead of the approaching winter.” Policymakers are unable to provide the required energy supply.

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