- Odds of Fed cut in September a tad lower at 83%
- Zelenskiy flies to Washington on Monday to meet Trump
- Focus on Fed's Jackson Hole symposium for rate clues
MUMBAI, Aug 18 (Reuters) - The dollar gained on Monday ahead of a meeting between U.S. President Donald Trump and his Ukrainian and European counterparts, while focus also turned to the Federal Reserve's Jackson Hole symposium for policy cues.
The euro was down 0.2% against the dollar at $1.1680, the yen slipped by a similar magnitude to 147.445, while the British pound was down about 0.1% at $1.3544.
The paring of wagers on a rate cut by the Fed next month helped the dollar find some support amid otherwise muted moves in foreign exchange markets on Monday.
Money markets are now pricing in an 83% chance the Fed will ease rates by a quarter point next month, as traders pulled back wagers on the certainty of a cut after a raft of data including a jump in U.S. wholesale prices last month and a solid increase in July's retail sales figures.
Fed Chair Jerome Powell is due to speak on the economic outlook and the central bank's policy framework at the Jackson Hole symposium between August 21 and 23.
MUFG expects the U.S. central bank to cut rates in September as well, but it's unlikely that the Fed chair will give a clear signal towards that later this week, said Lee Hardman, senior currency analyst at MUFG Bank.
Powell's last speech to the conference before his term ends next May comes as he looks to straddle the Fed's twin goals of stable prices and low unemployment.
Inflation in the U.S. is running above the central bank's target while recent data has also pointed to a slowing of the labour market.
"There is a majority expectation of further dollar weakness, but the minority, who would rather buy at current levels and don’t see convincing evidence of weak U.S. growth, has a reasonable following too," Kit Juckes, chief FX strategist at Societe Generale, said in a Monday note referring to interactions with clients.
The dollar was up 0.1% against a basket of peers on Monday but has declined over 9.5% over 2025 so far.
The main event for investors on Monday is a White House meeting between Trump and Volodymyr Zelenskiy, who will be joined by some European leaders, as Washington presses Ukraine to accept a quick peace deal to end Europe's deadliest war in 80 years.
Trump had met his Russian counterpart Vladimir Putin on Friday and agreed that a peace deal should be worked upon without a ceasefire.
"Financial markets are continuing to trade like there could be some – still undetermined – path to peace," an ING analyst note said.
"With risk assets bid and energy prices offered, we expect the dollar to stay under a little pressure as dollar-based investors continue to put money to work," the note said.
Trump told Ukraine to give up hopes of getting back annexed Crimea or joining NATO as he prepared to host Zelenskiy and European leaders in Washington to press Kyiv into accepting a peace deal with Russia.
In other currencies, the Swiss franc was little changed at 0.80965 while the Australian dollar rose 0.1% to $0.6515 and the New Zealand dollar rose 0.2% to $0.5941.
Cryptocurrency bitcoin halted its towering rally and eased from a record high. It last traded 2.2% lower at $115,129.46.
Ether similarly slid 4.6% to $4,275.85, after hitting its highest in nearly four years last week.
Reporting by Jaspreet Kalra; Editing by Sonali Paul, William Maclean and Toby Chopra
Source: Reuters