Christine Lagarde, the President of the European Central Bank (ECB), wished in her New Year’s message a year ” prosperous “2025 got off to a bad start for the euro. The single European currency in fact fell, on Thursday January 2, to its lowest level since November 2022 against the American dollar, at 1.0226 dollars per 1 euro.
Since its peak on September 30, 2024 (at $1.1196), the depreciation of the euro against the greenback has now reached nearly 9% and brings it closer to the symbolic threshold of parity with the dollar, below which it does not has declined since November 2022, when the surge in energy prices caused by the Russian invasion of Ukraine fueled fears of recession in Europe.
Two years and two months later, the fall in the euro can be explained more by the increasingly marked differences between the health of the American economy and that of the euro zone, which were highlighted by the very first economic indicators. of 2025.
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The indices measuring the evolution of activity in industry, published Thursday January 2, show that the contraction in activity was even stronger than anticipated in December 2024 in the euro zone, in particular in its three main economies, Germany, France and Italy. As a result, manufacturers have further reduced their stocks and their workforce, due to a lack of improvement in production prospects.
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“The decline in new orders has even increased compared to October and November [2024]in turn leading to an acceleration in the decline in work in progress and thus destroying any hope of an imminent resumption of activity.explains Cyrus de la Rubia, chief economist at Hamburg Commercial Bank, which publishes these surveys closely monitored by investors with S&P Global. To this already more than gloomy climate could be added a rebound in the energy bills of European companies, after the cessation of deliveries of Russian gas via Ukraine on Tuesday December 31, 2024.
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