Euro Falls Below Key Support as Strong Inflation Data Bolsters Dollar

The Euro slipped below 1.1650 against the US Dollar on Thursday, marking its second consecutive day of losses.

The greenback found fresh support from stronger-than-expected US inflation data released on Wednesday.

The latest US Consumer Price Index (CPI) report showed inflation running hotter than market forecasts, which is crucial as it directly influences the Federal Reserve's monetary policy trajectory.

As a result of the strong inflation data, US Treasury yields surged, making dollar-denominated assets more attractive and increasing demand for the dollar.

The dollar index (DXY) climbed to a two-week high, putting downward pressure on the EUR/USD pair.

Market participants are now focusing on the Federal Reserve's annual Jackson Hole Economic Symposium, which begins today, where Fed Chair Jerome Powell is expected to provide further clarity on the central bank's plans for interest rate hikes and its quantitative tightening program.