LONDON, Aug 23 Reuters The euro hit a fresh twodecade low on Tuesday, dealt a fresh blow by renewed concern that an energy shock will keep inflation elevated and makes a recession in Europe all but certain.

China39;s yuan weakened to a twoyear low, while sterling briefly touched its weakest since March 2020.

Business activity data from Europe was not as bad as feared, pushing the euro off the 20year low hit early in the session, at 0.99005.

But by 0820 GMT, the currency was still down 0.15 at 0.9930 and holding below the key 1level.

What we39;re trying to figure out is how much of the move in the euro is driven by thin summer liquidity and how much is driven by flows, said Kenneth Broux, a currency strategist at Societe Generale in London.

But of course the increase in gas prices yesterday is bad news all around.

British and Dutch wholesale gas prices rose sharply on Monday as the prospect of maintenance on the main Russian pipeline to Europe put markets on edge.

Russia will halt natural gas supplies to Europe via the Nord Stream 1 pipeline for three days at the end of the month, the latest reminder of the precarious state of the continent39;s energy supply. 

Heat waves on the continent have already put a strain on energy supply and worries are growing that any disruption during the winter months could be devastating for business activity.

Given the current mood, there39;s obviously concerns as to whether that39;s going to be three days or whether it39;s going…