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EUR/USD falls to fresh 2-year low, weighed by CPI

FXStreet (Córdoba) - EUR/USD came under pressure during the European session and dropped below the 1.2660 level to hit its lowest level in over two years.

EUR/USD started to fall a few minutes before the Eurozone CPI release and the decline intensified after data showed inflation remained subdued in September. Consumer inflation rose 0.3% year-over-year just as expected, while excluding food and energy it grew 0.7% in the same period.

EUR/USD dropped more than half a cent over the last minutes and printed a low of 1.2623 so far. At time of writing, EUR/USD is trading at 1.2625, recording a 0.46% loss on the day.

Low inflation has been a concern for the European Central Bank with prices failing to pick up. Today’s 0.3% reading is well below the bank’s 2.0% target and it represents the lowest level since October 2009.

EUR/USD technical levels

In terms of technical levels, EUR/USD could find immediate supports at 1.2600 (psychological level) and 1.2560 (Sep 6 2012 low). On the flip side, resistances are seen at 1.2714 (Sep 29 high) and 1.2730 (100-hour SMA).

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