Sharjah24 - Reuters: The euro edged higher on Thursday, supported by rising risk appetite but still within striking distance of its two-decade low as surging energy prices fuel recession fears.
Meanwhile, implied volatility in the forex market was still at its highest levels since late March 2020 at 11.2%, reflecting a nervous market while investors look at the parity between the single currency and the dollar.
Equities managed gradual gains on Thursday as investors grappled with the risks of a recession and a potential pause in interest rate hikes.
"Parity (between the euro and the dollar) is within reach, and one can expect the market to want to see it now," said Moritz Paysen forex and rates advisor at Berenberg.
The euro rose 0.1% to 1.019 after hitting a two-decade low at 1.01615 on Wednesday.
According to George Saravelos, global head of forex research at Deutsche Bank, "if Europe and the U.S. slip-slide into a recession in Q3 while the Fed is still hiking rates, these levels (0.95-0.97 in EUR/USD) could well be reached."
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