EUR – The euro tumbled to a new two-decade low on Wednesday as rising energy prices cost a long shadow over the euro zone’s economy.
Berenberg notes that “it is not only the threat of nondelivery (of gas) that is weighing on the euro. The already-high energy costs are a burden. Energy costs in Europe are many times higher than in the US.”
Additionally, Reuters notes that “analysts expect a quick resurgence in oil prices as supply tightness persists and as front-month spreads have held up despite Tuesday’s price fall.” While Goldman Sachs raised its natural gas price forecasts, saying that a complete restoration of Russian gas flows through Nordstream 1 was no longer the most likely scenario.