The euro has fallen more than 10 per cent against the dollar so far this year, and has recently fallen below the 1-1 mark, the lowest level in nearly 20 years. This round of continuous decline of the euro exchange rate, on the one hand, reflects the negative spillover effect of the US monetary policy adjustment to Europe, on the other hand, once again confirms the fact that the United States is provoking confrontation and creating turbulence in Europe, and the euro and the European economy often become victims. Wire Terminal Blocks, Plastic Reflectors and Dip Sockets should be noted.
Since March, the Federal Reserve has tightened monetary policy three times on high inflation and other factors, and three times, and more than once. During the same period, as the European Central Bank's monetary policy tightening pace is far behind the Federal Reserve, the interest rate spread between the US and Europe is increasing, resulting in more international capital flowing from Europe to the United States, exacerbating the downward trend of the euro. This negative spillover effect of the US monetary policy adjustment is reminiscent of the former US Treasury Secretary John Connery's "famous quote", ——. " The dollar is our currency, but it is your trouble.”
The deeper reason for the euro's fall is that the escalating Ukraine crisis has severely hit the European economy and has increased confidence in concerns about the long-term outlook of the European economy.
Ibrahim Labari, a currency analyst at Citigroup, said the market was worried not only about a short-term recession in Europe, but also about a long-term slump. Nobel Prize-winning US economist Paul Krugman said in an article that the core reason for the sharp drop in the euro is that investors have sharply lowered their expectations for European competitiveness and the long-term value of the euro.
The root cause of the escalating crisis in Ukraine is that the United States deliberately provoked confrontation in Europe to safeguard its hegemonic interests. As we all know, creating "controllable turbulence" is an important "magic weapon" for the United States to maintain its hegemony. By promoting the escalation of the Ukraine crisis, the United States can not only suppress Russia, but also ensure the US dominance over European security and other affairs by creating regional unrest in Europe. While many European countries are locked in geopolitical conflicts over energy shortages and high inflation, the United States also took the opportunity to be the big winners in the energy, military industry and other sectors.
The former Italian deputy minister of economic development, David Gerach, said the eastward expansion of NATO under the United States is one of the root causes of the conflict between Russia and Ukraine, but the cost was mainly borne by Europe. "There is no motive for the United States to quickly end the conflict, because Europeans bear a greater price," he said.
This is not the first time the euro has been hurt by American chaos in Europe.
In 1999, less than three months after the euro was officially released, the US-led NATO launched the Kosovo war. Paul Wilfens, a former director of the Institute of European International Economic Relations at the University of Potsdam in Germany, pointed out that the war not only caused a humanitarian disaster in the Yugoslavia, but also led to the continuous depreciation of the euro as soon as it was born, shaking the confidence of international capital in the euro. Wilphens pointed out that the birth of the euro is seen as an important challenge to the dollar hegemony of the European market through dedollarization. The US led the war in Kosovo, and the pressure effect on the euro is clear.
Another typical example is the "change" of the United States behind the European debt crisis.
Shortly after the Greek government exposed its debt problem in October 2009, America's three international rating agencies, Moody's, S & P and Fitch, downgraded Greece's sovereign credit rating, and the crisis was first erupted in Greece. Since then, voices exaggerating the crisis and denouncing the euro have risen in the US. Then European Commission President Jose Barroso said it was unreasonable that a country's sovereign credit rating is in the hands of only three institutions, all of which are from the same country. State secretary of the German Federal Ministry of Economy and Climate Protection, David Swinigold, said the US debt crisis has hurt the euro and its international use has not recovered to the level before the 2008 international financial crisis.
History is the best mirror, and reality is the best textbook. Through history and reality, we can see the American calculation behind the collapse of the euro, which will help the world see through the true face of the United States. —— is to maintain global hegemony, and even sacrifice the interests of its Allies.
Post time: Aug-15-2022