Forex - EUR/USD hits fresh 2-week lows after strong U.S. data

The euro dropped to fresh two-week lows against the U.S. dollar on Friday, after strong U.S. economic reports fuelled fresh expectations for the Federal Reserve to soon begin tapering its stimulus program. 

EUR/USD hit 1.3210 during U.S. morning trade, the pair's lowest since August 15; the pair subsequently consolidated at 1.3210, shedding 0.22%. 

The pair was likely to find support at 1.3144, the low of July 21 and resistance at 1.3294, the high of August 2. 

In a revised report, the University of Michigan said its consumer sentiment index rose to 82.1 in August, from a reading of 80.0 the previous month, beating expectations for an uptick to 80.5. 

A separate report showed that the Chicago purchasing managers' index rose to 53.0 this month, from a reading of 52.3 in July, in line with expectations. 

Earlier Friday, the Bureau of Economic Analysis said that personal spending rose less-than-expected in July, gaining 0.1% after an upwardly revised 0.6% increase the previous month. Analysts had expected personal spending to rise 0.3% last month. 

In addition, data showed that U.S. core consumer prices, excluding food and energy, rose 0.1% in July, confounding expectations for a 0.2%, following a 0.2% increase in June. 

In the euro zone, official data showed that consumer price inflation ticked down to an annualized rate of 1.3% in August, from 1.6% in July, compared to expectations for a slip to 1.4%. 

A separate report showed that the unemployment rate in the euro zone remained unchanged at 12.1% in July, in line with expectations. 

Official data also showed that German retail sales dropped 1.4% last month, confounding expectations for a 0.5% rise. June's figure was revised up to a 0.8% decline from a previously estimated 1.5% fall. 

The euro was steady against the pound with EUR/GBP dipping 0.04%, to hit 0.8536. 

Markets were jittery amid concerns over an impending U.S.-led military strike against Syria, following the alleged use of chemical weapons. 

The White House said on Thursday that President Barack Obama will decide on a response to Syria based on U.S. interests, but will continue to consult with Britain despite the British Parliament's "no" vote to a military intervention.