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EUR/USD came under renewed selling pressure on Monday as fresh military exchanges between the United States and Iran revived demand for the US dollar and lifted global energy prices. The pair struggled to build on last week’s recovery and moved back toward the lower end of its recent range as investors prepared for the latest US Consumer Price Index report. Higher crude oil prices have added to inflation concerns, pushing US Treasury yields higher and strengthening expectations that the Federal Reserve may keep interest rates restrictive for longer. The Dollar Index has recovered toward the 101.00 area after ending the previous week lower. For EUR/USD, the stronger greenback has brought the 1.1370 support level back into focus, with traders assessing whether the pair can stabilize or extend its decline toward 1.1350 and 1.1300. Why Is EUR/USD Falling Today? The latest weakness in EUR/USD reflects a combination of geopolitical risk, higher oil prices and rising US bond yields. Fresh attacks between the US and Iran over the weekend raised concerns about the future of shipping through the Strait of Hormuz. Iran said the key waterway had been closed again, while Washington maintained that commercial traffic could continue. The conflicting claims sent crude oil prices sharply higher and revived concerns that another energy shock could keep global inflation elevated. Higher oil prices tend to support the US dollar during periods of market stress. They can also place additional pressure on the euro because the Eurozone relies heavily on imported energy, leaving the region more exposed to rising fuel costs. US CPI Could Decide the Dollar’s Next Move The US inflation report is likely to become the most important driver for EUR/USD in the near term. A stronger-than-expected CPI reading would reinforce expectations that the Federal Reserve may need to maintain higher interest rates or consider additional tightening later this year. That outcome would likely push Treasury yields and the dollar higher, increasing the risk of EUR/USD falling through its current support zone. A softer inflation report would create a different setup. It could reduce pressure on the Fed to tighten policy further and allow EUR/USD to recover some of its recent losses. However, the impact of softer inflation could be limited if oil prices continue rising or geopolitical tensions worsen. Euro Recovery Struggles Near 1.1500 EUR/USD recently recovered from lows around 1.1325 and moved above 1.1420, but the advance stalled before the pair could establish a sustained move through the 1.1475 to 1.1500 region. That failure suggests sellers remain active whenever the euro approaches higher levels. The pair now faces an important test around 1.1370. A clear move below that level would increase the likelihood of a decline toward 1.1350, followed by the June low near 1.1325. If selling pressure persists, the psychological 1.1300 level could become the next target. On the upside, EUR/USD would need to recover above 1.1450 before challenging 1.1475 and 1.1500 again. A sustained break through 1.1500 would weaken the immediate bearish outlook and could support a broader recovery toward 1.1580. ECB and Fed Policy Expectations Remain Divided Interest-rate expectations on both sides of the Atlantic continue to shape the EUR/USD outlook. The Federal Reserve remains focused on inflation after stronger energy prices complicated the outlook for consumer prices. Recent weakness in US employment reduced expectations of immediate tightening, but the latest geopolitical escalation has prevented markets from fully dismissing the possibility of another rate increase. In Europe, softer core inflation has reduced expectations of further European Central Bank tightening. That leaves the euro with less policy support, particularly if US inflation remains elevated and Treasury yields continue climbing. Comments from Federal Reserve and ECB officials will therefore remain important as traders look for any change in the policy outlook. EUR/USD Outlook The near-term EUR/USD price forecast remains cautious as the pair struggles to hold its recent recovery. The US dollar is benefiting from safe-haven demand, rising oil prices and higher Treasury yields, while the euro faces renewed pressure from Europe’s exposure to imported energy costs. A break below 1.1370 would put 1.1350 and 1.1300 within reach. However, softer US inflation or an easing of Middle East tensions could weaken the dollar and help EUR/USD return toward 1.1450 and 1.1500. For now, US CPI and developments surrounding the Strait of Hormuz are likely to determine whether the pair stabilizes or begins another leg lower. Why is EUR/USD falling today? EUR/USD is falling as renewed US-Iran tensions increase safe-haven demand for the US dollar. Rising oil prices and Treasury yields have also strengthened expectations that US interest rates may remain elevated. What are the key EUR/USD levels to watch? The main support levels are 1.1370, 1.1350 and 1.1300. Resistance is located near 1.1450, followed by 1.1475 and 1.1500. How could US CPI affect EUR/USD? A hotter US CPI reading could strengthen the dollar and push EUR/USD lower by increasing expectations of tighter Federal Reserve policy. Softer inflation could weaken the greenback and support a euro recovery.