Euro just off its two decade low
Rising risk appetite support the single currency
Swiss Franc hovering around 7year high vs euro
Aussie dollar up on commodity prices rebound

July 7 Reuters The euro edged higher on Thursday, supported by rising risk appetite but still within striking distance of its twodecade low as surging energy prices fuel recession fears.

Meanwhile, implied volatility in the forex market was still at its highest levels since late March 2020 at 11.2 , reflecting a nervous market while investors look at the parity between the single currency and the dollar.

Equities managed gradual gains on Thursday as investors grappled with the risks of a recession and a potential pause in interest rate hikes.

Parity between the euro and the dollar is within reach, and one can expect the market to want to see it now, said Moritz Paysen forex and rates advisor at Berenberg.

The euro rose 0.1 to 1.019 after hitting a twodecade low at 1.01615 on Wednesday.

According to George Saravelos, global head of forex research at Deutsche Bank, if Europe and the U.S. slipslide into a recession in Q3 while the Fed is still hiking rates, these levels 0.950.97 in EURUSD could well be reached.

The two key catalysts to mark a turn in the USD embedded in our forecasts are a signal that the Fed is entering a protracted pause in its tightening cycle andor a clear peak in European energy tensions via an end to Ukraine hostilities, he said.

The dollar index which measures the…