(Updates prices, adds analyst quote)

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U.S., global stocks add to gains

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Eyes on Fed minutes, Powell speech to support rate cuts

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Oil prices dip

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Gold loses hold on highs

By Lawrence Delevingne and Nell Mackenzie

Aug 19 (Reuters) - Wall Street pushed higher and the

dollar tipped lower on Monday, after stocks surged last week on

expectations the U.S. economy would dodge a recession and

cooling inflation would kick off a cycle of interest rate cuts.

The Dow Jones Industrial Average rose 0.51%, to

40,866, the S&P 500 gained 0.53%, to 5,583 and the Nasdaq

Composite gained 0.54%, to 17,727. MSCI's broadest index

of world stocks had edged up around 0.67%.

The prospect of lower borrowing costs could not sustain

gold's historic highs and the dollar dipped against the euro,

while the yen lunged higher.

In the U.S., Federal Reserve members Mary Daly and Austan

Goolsbee were out over the weekend to flag the possibility of

easing in September, while minutes of the last policy meeting

due this week should underline the dovish outlook.

Fed Chair Jerome Powell speaks in Jackson Hole on Friday and

investors assume he will acknowledge the case for a cut.

"We expect the chairman to convey on Friday that the Fed is

likely to begin easing monetary policy next month, without fully

committing to the size of the rate cut," TD Securities analysts

wrote in a note on Monday.

Interest rate futures are fully priced for a

quarter-point move, and imply a 25% chance of 50 basis points

with much depending on what the next payrolls report shows.

Yields on U.S. government debt eased on Monday; the yield on

benchmark U.S. 10-year notes fell 3.2 basis points

to 3.86%, from 3.892% late on Friday.

Analysts at Goldman Sachs downshifted their U.S. recession

expectations to a 20% chance and could push them lower if the

August jobs report due in September "looks reasonably good",

analysts said in a note on Friday.

Ahead of the busy week, broad European shares moved

about 0.6% higher, touching an over three-week high in

broad-based market gains, while the blue-chip FTSE 100 index

traded up 0.55%.

Investors are anticipating flash Purchasing Managers' Index

(PMI) data for Britain, France, Germany and the Eurozone later

this week.

Earlier, the Nikkei index .N225 closed 1.77% lower at

37,388.62, snapping a five-day winning run that pushed it up

8.7% last week. Chinese blue chips closed about 0.3%

higher.

CUTS FOR ALL

The Fed is not alone in contemplating looser policy, with

Sweden's central bank expected to cut rates this week, possibly

by an outsized 50 basis points.

In currency markets, the dollar lapsed 0.67% to 146.58 yen

while the euro firmed to $1.107, continuing

its August climb.

Even as markets have calmed, it is worth remembering that

the economic fundamentals behind the global markets sell-off two

weeks ago have not completely vanished, said Deutsche Bank macro

strategist Henry Allen.

"Economic data has been increasingly soft at a global level,

falling inflation means that monetary policy is increasingly

tight in real terms, geopolitical concerns are elevated, and

we're heading into a tough period on a seasonal basis," said

Allen in a note.

A softer dollar combined with lower bond yields could not

hold gold at its zenith and it fell to around $2,501 an ounce

, down from its all-time peak of $2,509.

Oil prices dipped as concerns about Chinese demand continued

to weigh on sentiment.

U.S. crude lost 2.95% to $74.39 a barrel and Brent

fell to $77.62 per barrel, down 2.59% on the day.