The euro reached parity against the dollar today for first time in more than two years on a groundswell of concern about prospects for the US economy following a string of corporate accounting scandals.
The single European currency rose to $1.0011, climbing above the symbolic one-to-one level against the US unit for the first time since February 2000.
It is a far cry from October 2000, when the euro plumbed a record low-point close to 0.82 dollars after losing about a third of its value since its launch on January 1st, 1999.
Then, the euro had appeared impotent against a rising dollar as investors flocked to put their money in the US economy, lured in by the promise a new era of productivity thanks to new technologies such as the Internet.
But after a recent flurry of scandals over accounting malpractice at US corporate giants such as Enron and WorldCom, economists say the tide of sentiment has turned against the dollar.
Underlying fundamental factors are rising US trade and balance of payments deficits, and a rising Japanese trade surplus.
AFP