The U.S. dollar was struggling to make headway against its peers on Monday, though it traded in a tight range as investors awaited fresh catalysts this week that could offer clues on the outlook for U.S. interest rates.

The dollar fell to a seven-month low and the Japanese yen hit a more than one-week high as traders awaited comments from Federal Reserve Chair Jerome Powell this week likely to hint the U.S. central bank will start cutting interest rates in September.

A key focus on Powell's speech at Jackson Hole on Friday will be whether he indicates that the Fed is likely to cut rates by 25 or 50 basis points. Odds of a larger cut have declined since data last week showed hotter-than-expected shelter inflation for July and also a strong retail sales report for the month.

Another main focal point will be whether Powell indicates that rate cuts are likely at each meeting going forward. But markets may be overestimate how far and fast the Fed is likely to act.

"I think we're still at the point of the justification to cut in September," said Eugene Epstein, head of structuring for North America at Moneycorp in New Jersey.

"On a relative basis it would be kind of over the top to be one of the last central banks to start their cutting cycle, but then also to start cutting immediately and cut 50 basis points and then cut every meeting after that."

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