The value of the euro has fallen below the value of the dollar for the first time in almost 20 years, as the war in Ukraine is affecting the value of the currency.
One euro was bought for $0.998 in foreign exchange markets on July 13. The value of the euro fell by 0.4 percent during the day.
The European Central Bank has been slower than other central banks to raise rates, further weakening the euro.
Currencies tend to rise in value when the relevant central bank raises interest rates, as international investors seek to gain a greater return from holding assets in that currency.
In recent months, the dollar has been strong as the US Federal Reserve has raised interest rates.
The weakening euro will make imports more expensive for eurozone countries, especially goods priced in dollars, such as crude oil.
This may contribute to an even higher inflation in the eurozone, which reached 8.6 percent in June.
A spokesman for the European Central Bank said that “we do not aim for a specific exchange rate. However, we are always attentive to exchange rate inflation, in line with our mandate for price stability.”
The European Central Bank is expected to start raising interest rates from next week.
Since the beginning of the year, the euro has fallen almost 12 percent against the dollar.