Aug 18 (Reuters) - Sterling treaded water against the

dollar on Monday as investors focused on a pending meeting

between U.S. President Donald Trump and leaders from Ukraine and

Europe as well as UK consumer inflation data due later in the

week.

Sterling was flat at $1.3547 on the day but has

gained about 2% against the dollar over August so far, helped by

upbeat economic data and a hawkish rate cut by the Bank of

England earlier in the month.

Britain's consumer inflation data for July is due on

Wednesday and analysts at Goldman Sachs reckon that the domestic

macro backdrop will continue to be a key source of volatility

for the currency's performance versus European peers.

Goldman Sachs forecasts imply that core inflation in Britain

edged down to 3.62% last month, from 3.66% in June and 9 basis

points below the level implied by the Bank of England's

projections.

"Even with regional underperformance, though, we continue to

expect sterling's high beta to the Euro to support an upward

path in GBP/USD," analysts at Goldman Sachs said in a note.

On Monday, the euro was down 0.1% against sterling

at 0.8624.

"We do think that the UK's CPI data is going to come in a

little hotter this week. That should temporarily support the

pound but PMI (data) on Thursday should reverse that," said Nick

Rees, head of macro research at Monex Europe.

"We think you're going to see increased divergence between

the UK and euro zone economies."

The major economic event for global markets this week will

be the Kansas City Federal Reserve's August 21-23 Jackson Hole

symposium.

Fed Chair Jerome Powell is due to speak on the economic

outlook and the central bank's policy framework on Friday.

Money markets are currently pricing in an 85% chance that

the Fed will cut policy rates by 25 basis points next month.