In July 20 of 2012 the value of the Euro reached the $1.2176 (Index Mundi 2012), a quite low level. This fact has caused severe concerns to the leaders of the EU. The threat of a potential collapse of the Euro zone had appeared.
In order to understand the position of the Euro towards the US dollar it would be necessary to refer to the fluctuations in the value of these currencies for the last four years, i.e. from 2009 up to 2012. In this way, it would be made clear whether the power of the two currencies in the global market is equal or whether one of them is at an advantageous position.
During 2009, the value of the Euro was decreased at a level of 20%, compared to 2008. The global financial crisis of that period has been probably the key reason for the above phenomenon. At the end of the above year the value of the Euro was estimated to $1.43 (Index Mundi 2012). The year that followed, 2010, the value of the Euro was further decreased; by the end of 2010 the value of the Euro was fell to $1.32 (Index Mundi 2012). Again, the Euro debt crisis, which has appeared to be more intensive in Greece, has been related to the further limitation of the value of Euro towards that of the US dollar (Index Mundi 2012). .
In 2011, the distance between the two currencies was further decreased. In the beginning of 2011 the Euro seemed as able to increase its power as a global currency. Indeed, the introduction of effective measures in regard to the Greece debt crisis has caused pressures on the US dollar; during the first months of 2011 the US dollar lost a 10% of its value (Index Mundi 2012). At the same time, Euro was strengthened reaching the $1.4675 by July 2011 (Index Mundi 2012). It seems that investors were, still, afraid of investing on the US dollar due to the US Debt crisis of 2008, especially since the above crisis resulted to a global recession. Moreover, it was in that period that the interest rate in the EU was increased to 1.