On Monday, the euro dropped below 99 cents for the first time in 20 years after Russia announced it will permanently shut down its main gas supply pipeline to Europe.
At 10:00 a.m., the common currency of the EU was trading at roughly $0.9911. London time (5:00 a.m. ET), after rising from a day’s low of $0.9881.
The dollar index, which compares the value of the dollar to six major currencies, also reached a level not seen in two decades when the British pound fell due to concerns about the oil supply and the expansion of the European economy.

Using the crucial Nord Stream 1 pipeline as its route, Russian energy provider Gazprom announced on Friday that it will not continue supplying natural gas to Germany. It cited an issue with a turbine. A plan to establish a price restriction on Russian oil was approved by the Group of Seven economic heavyweights hours before the announcement.
A benchmark for natural gas trading in Europe, the front-month gas price at the Dutch TTF hub increased by about 30% on Monday morning, reaching 282.5 euros per megawatt hour.
It comes ahead of a meeting of the European Central Bank on Thursday, when analysts predict it will hike its benchmark deposit rate from 0 to 0.5% or 0.75% in response to worries about how Europe will be able to fulfill its energy needs this winter and the possibility of a slowdown in GDP.
“We expect that Russia is respecting the contracts that they have, but even if the weaponization of energy will continue or will increase in response to our decisions, I think that the European Union is ready to react,” the EU’s commissioner for economy, Paolo Gentiloni, spoke to CNBC over the weekend.
“Of course, we have to save energy, we have to share energy, we have [a] high level of storage and we are not afraid of Putin’s decisions.”

The euro and European government bonds have seen a spike in yields over the past month on the assumption of interest rate increases, according to Viraj Patel, global macro analyst at financial advice Vanda Research. He said that many investors are looking to short these securities.
“These markets are selling off on any bad news related to the Russia gas flows narrative, whilst reluctant to rally on any marginal improvement in the energy crisis,” via email, Patel informed CNBC.
However, Patel cautioned that for under-owned European assets, bad news can eventually turn into good news.
“The market is under-appreciating the chance for policy intervention from government officials helping to reduce stagflation risks on the continent,” he was referring to the fact that the case for the euro rising to 1.05 against the dollar now appeared to be at least as strong as the rationale for a decline to 0.95.
A 65 billion euro program was just revealed by the German government to lower consumer energy costs and help businesses.
As the U.K. waits to learn who its new prime leader will be, the British pound was trading at 1.1498 to the dollar at that time. The new premier will have to deal with an intensifying cost-of-living problem brought on by skyrocketing energy prices.
Since Brexit, August saw a 4.5% decline in the value of the pound against the dollar. One analyst predicted that due to the political and economic unpredictability, the pound would “plumb new depths” and may reach $1.05 by the middle of next year.