The euro rose to its highest level since May 2018 against the greenback on September 1, reaching the key $1.20 mark. However, the single currency then retreated to the 1.19 level.
The euro is gaining strength against the dollar, having soared by 11% from its March low amid support measures taken by the EU authorities.
Meanwhile, the Fed’s monetary policy has been playing a critical role in dragging down the dollar's value over the past few months.
According to economists, the stronger dollar era may be on borrowed time as the Federal Reserve eased its monetary policy in response to the economic crisis. The US central bank's policymakers lowered the benchmark federal funds rate to a range of zero to 0.25%. All this caused government bond yields falling and investors looking for safer assets.
