EUR/USD has been extending its rapid decline, tumbling below the 1.21 level. The euro is succumbing to dollar strength, which is sending the world's most popular pair to levels last seen on May 14, four weeks ago.
The greenback is reacting positively to upbeat US Consumer Sentiment figures. The University of Michigan's preliminary read for June surprised with 86.4, reversing previous gains and indicating more robust consumption down the line. The decline in the survey's inflation expectations component seemed to be shrugged off by markets.
On Thursday, the dollar failed to take advantage of May's robust inflation figures. The headline Consumer Price Index shot to 5% while Core CPI hit 3.8%, both levels last seen several years ago. Friday's move could be a belated response to that publication and also repositioning of traders ahead of next week's Federal Reserve decision.
EUR/USD lost the round 1.21 level, which was also June's previous trough. At the time of writing, the currency pair hit a low of 1.2092. Further support is seen at 1.2055 and resistance above 1.21 awaits at 1.2145.
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