STORY: The euro slid to a 20-year low and came close to parity against the dollar on Monday, driven by concerns that an energy crisis will tip the region into a recession, while the U.S. dollar was boosted by expectations that the Federal Reserve will hike rates faster and further than its peers.
The euro tumbled Monday to its weakest level since December 2002.
William Rhind, founder and CEO of GraniteShares, says the weak euro reflects the fact that Europe is bearing the brunt of the crisis in Ukraine.
"Unfortunately for Europe, the effect of Russia-Ukraine has been amplified more than it has been here in the states. And certainly energy prices are much, much higher, relatively speaking, in Europe than here. So the impact of higher commodity prices are being felt more in Europe than it has in the states so far."
And some fear it could soon get worse.
The biggest single pipeline carrying Russian gas to Germany, the Nord Stream 1, began annual maintenance on Monday, with flows expected to stop for 10 days. Governments, markets and companies are worried the shutdown might be extended because of the war in Ukraine.
But while the Euro is sinking, the U.S. dollar is soaring..
The U.S. currency has gained on expectations that the Fed will continue to aggressively raise rates as it tackles inflation.
The Fed is expected to lift rates by another 75 basis points at its July meeting.
The strong dollar is good news for U.S. travelers going overseas this summer.. where everything from hotels to restaurants to shopping will be at a discount from prices just a few months ago.