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The Brit, 27, confirmed his absence following an injury suffered in training that put paid to his hopes of defending three crowns in Budapest next month.
“I've fortunately never had to deal with an injury in my swimming career so this is a real blow and a new challenge for me," wrote Peaty on Wednesday.
“I'm already in great hands and starting to recover but, honestly, I'm devastated. I was on track for a huge summer so, like when anything doesn't go according to plan, it's a really challenging time.
“I won't compromise my recovery and I will use this time to reflect on what the sport means to me and what it feels like to watch someone else win a race I should be in. It's not going to be easy!”
Peaty was set to defend his 50-metre and 100m breastroke crowns plus the 4x100m medley relay gold he participated in in 2019, and will now prepare for the Commonwealth Games in Birmingham, which begin at the end of July.
“I'll never shy away from a challenge but on this one I've got to use my head more than my heart,” he added.
“I will be back in the pool as soon as I can be, with my focus on recovering and building up my strength ahead of the Commonwealth Games this summer.”