The conflict in Ukraine has caused the euro to depreciate below the dollar for the first time in over 20 years.

At 12:45 GMT, the price of one euro was $0.998, down 0.4 percent from the previous day’s trade.

The likelihood of a recession in the euro area has grown due to worries that Russia would limit Europe’s access to energy.

In hiking rates, the European Central Bank has trailed behind other central banks, further devaluing the euro.

When the central bank in question raises interest rates, currencies often climb as foreign investors seek a higher return for keeping assets denominated in that currency.

Additionally, the dollar has been strong in recent months due to investors seeking out dollar assets as safe havens during periods of global unrest and the US central bank hiking interest rates.

For nations in the eurozone, an undervalued currency will increase the cost of imports, particularly those items priced in dollars like crude oil.

The eurozone’s already-high 8.6 percent rate of inflation for June might rise even more as a result of this.

The ECB does not “target a particular exchange rate, but we are always alert to the influence of the exchange rate on inflation, in keeping with our mission for price stability,” according to a spokesman for the institution.

Next week, the bank is anticipated to begin raising interest rates.

Since the beginning of the year, the euro’s value against the dollar has decreased by roughly 12%.

For the majority of its existence, the euro has been valued more than the dollar. It lagged behind the dollar in the years after the currency’s debut in 1999, but the last time it did so was in December 2002, less than a year after the first-ever release of euro notes and coins.