The USD is little changed to start the new trading day.

The USD remains largely flat after the Trump-Putin meeting concluded without a ceasefire or future talks, shifting market focus to Fed Chair Powell's upcoming Jackson Hole speech, particularly as September rate cut expectations have declined to 83%. Concurrently, Ukrainian President Zelenskiy is set to meet with President Trump amid concerns over potential pressure for a Russia-favorable peace settlement. While premarket US equities are mixed, Treasury yields have moved lower, reflecting a broader market uncertainty despite minimal fallout from the initial Trump-Putin discussions.

Analysis

The US dollar and broader markets are in a holding pattern, defined by geopolitical uncertainty and anticipation of monetary policy guidance from the Federal Reserve. The conclusion of the Trump-Putin meeting without a ceasefire agreement has left a geopolitical overhang, with focus now shifting to an upcoming meeting between President Trump and Ukrainian President Zelenskiy, which introduces new potential volatility. The primary market catalyst is Fed Chair Powell's speech at the Jackson Hole Summit, an event carrying significant weight as market expectations for a September rate cut have recently fallen from 100% to 83%. This market indecision is reflected across asset classes: premarket US equity indices are mixed, and US Treasury yields are declining with the curve flattening, suggesting underlying caution. Technical analysis further confirms this lack of conviction, with the EUR/USD failing a key resistance test but holding above its 200-hour moving average at 1.16615, while the USD/JPY is described as "misbehaving" within a choppy range, unable to sustain a directional move.

Key Decisions for Investors

• Given the market's indecisive state ahead of Fed Chair Powell's speech, investors should consider maintaining a neutral stance and reducing exposure to large, directional bets in major currencies and indices.
• Monitor the outcome of the upcoming Trump-Zelenskiy meeting, as any unexpected developments regarding a peace settlement could introduce significant geopolitical volatility, particularly for European-related assets.
• For currency traders, the 200-hour moving average for EUR/USD at 1.16615 and the range-bound action in USD/JPY are critical levels; a decisive break following Powell's commentary could signal the market's next directional leg.
• Pay close attention to any shifts in Powell's tone regarding inflation and future rate paths, as the recent decline in rate-cut probability to 83% suggests the market is sensitive to any hawkish surprise.