The euro lost 0.5% to a two-decade low of $0.9900 as markets priced in more risk of a European recession, while EUROSTOXX 50 futures shed 3.0% and FTSE futures 1.0%

European stock futures slid on Monday while the euro took a fresh spill after Russia shut a major gas pipeline to Europe, leading some governments there to announce emergency measures to ease the pain of soaring energy prices.

The euro lost 0.5% to a two-decade low of $0.9900 as markets priced in more risk of a European recession, while EUROSTOXX 50 futures shed 3.0% and FTSE futures 1.0%.

Germany announced plans to spend 65 billion euros ($64.7 billion) on shielding customers and businesses from rising costs, while Finland and Sweden offered liquidity guarantees to keep power companies open.

Oil prices jumped along with the whole energy complex as a holiday in U.S. markets made for thin trading conditions. News of more coronavirus lockdowns in China only added to the jittery mood, with blue chips down 0.6%.

MSCI’s broadest index of Asia-Pacific shares outside Japan eased 0.6%, and Japan’s Nikkei was off a fraction. Wall Street fared a bit better having already dropped late on Friday, with S&P 500 futures edging up 0.2% and Nasdaq futures 0.1%.

The energy crisis is an added complication for the European Central Bank (ECB) as it meets this week to consider how much to raise interest rates.

Europe is faced with a dire energy outlook, with numerous anecdotes of firms cutting back production, said Tapas Strickland, head of market economics at NAB.

The ECB will undoubtedly decide to hike rates this week, he added. Markets are close to fully pricing in a 75bp hike after numerous ECB officials said they were leaning that way, though there is still likely to be a debate around 50 vs. 75.

Central banks in Canada and Australia are also expected to raise interest rates this week, while Federal Reserve Chair Jerome Powell and several other policy makers will make appearances and are likely to sound hawkish on inflation. While the August U.S. jobs report showed some welcome signs of cooling in the labour market, investors are still leaning toward a hike of 75 basis points from the Fed this month.

The two-year U.S. Treasury yield did fall almost 12 basis points on Friday and futures were trading flat on Monday amid general risk aversion.