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Euro sinks towards parity with dollar ahead of key US jobs report

The euro dropped to within less than a cent of hitting parity with the US dollar for the first time in two decades as concerns swirled over Europe’s economic outlook and traders awaited a key report on the US jobs market.

The common currency fell as much as 0.9 per cent on Friday to $1.007, with many of its peers also declining as the dollar ripped higher. It has dropped more than 10 per cent this year.

Investors are growing increasingly worried over the euro area economy as it faces mounting headwinds caused by Russia’s war in Ukraine, which has helped to drive record inflation.

Goldman Sachs warned on Thursday that the eurozone was “on the edge of recession” as Russia’s move to cut supplies of natural gas has sent prices of the vital fuel surging in Europe, something that has dealt a powerful blow to businesses across the region.

Prospects of a severe recession may weaken the European Central Bank’s resolve to…

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