Forex Today: Dollar runs as EUR plunges

What you need to take care of on  Tuesday, August 23:

Risk aversion took over financial markets at the beginning of the week amid recession fears hitting European shores. Gas prices soared in the region to new record highs as Russia announced unscheduled maintenance on the Nord Stream 1 pipeline, announcing it will shut it down for three days starting August 31.

European stocks collapsed, with the German DAX suffering the most. Also, the German Bundesbank released its monthly report, which noted that a recession in Germany is increasingly likely, and that could inflation will continue to accelerate and could peak at more than 10%.

The EUR/USD pair collapsed to a fresh 22-year low of 0.9925, holding nearby early in the Asian session. GBP/USD fell to its lowest since March 2020, trading at around 1.1760. Commodity-linked currencies were also down, with AUD/USD trading at the lower end of its August range in the 0.6870 area and the USD/CAD pair reaching a one-month high of 1.3060.

The greenback appreciated against its safe-haven rivals, with USD/CHF trading at 0.9640 and USD/JPY 137.40. Gold trades at around $1,737 a troy ounce.

Crude oil prices fell sharply ahead of the US opening, recovering afterwards. WTI traded as low as $86.28 a barrel to settle at around $90.60. Saudi Energy Minister said that OPEC+ might need to tighten output to stabilise the market.

Wall Street plunged and had its worst day since mid-June. US indexes lost roughly 2% each.  US Treasury yields edged north, with that on the 10-year note currently at 3.03%.

 Bitcoin price is at a crossroads – time to buy or should you wait for Jackson Hole Symposium?