Investing.com - The euro rallied over 1% against the U.S. dollar on Friday, as downbeat U.S. data sent the greenback broadly lower and a positive report on euro zone inflation continued to support the single currency.
EUR/USD hit 1.1113 during U.S. morning trade, the pair's highest since July 27; the pair subsequently consolidated at 1.1085, jumping 1.39%.
The pair was likely to find support at 1.0921, the session low and resistance at 1.1197, the high of July 13.
In a preliminary report, the University of Michigan said its consumer sentiment index ticked down to 93.1 in July from 93.3 the previous month, confounding expectations for a rise to 94.0.
The data came shortly after the Labor Department reported on Friday that U.S. employment costs rose 0.2%, the lowest gain since 1982, compared to expectations for a 0.6% increase. U.S. employment costs rose 0.7% in the three months to March.
Data also showed that the Chicago purchasing managers' index rose to 54.7 this month from 49.4 in June, swinging into expansion territory for the first time since April. Analysts had expected the index to rise to 50.5 in July.
Meanwhile, the single currency remained supported after data earlier showed that the euro zone's consumer price inflation rose 0.2% in July, in line with expectations and unchanged from the previous montth.
Core CPI, which excludes food, energy, alcohol, and tobacco costs, increased by 1.0% this month, above expectations for an uptick of 0.8%.
A separate report showed that the euro zone's unemployment rate remained unchanged at 11.1% last month, in line with expectations.
The euro was also sharply higher against the pound, with EUR/GBP up 1.12% to 0.7087.