USD volatility expected as Trump meets Zelensky amid geopolitical tensions

The US dollar faces potential volatility as President Trump's meeting with Ukrainian President Zelensky represents today's key geopolitical risk event. The Washington summit, followed by discussions with European leaders at 19:00 GMT, could significantly impact USD pairs depending on outcomes regarding Ukraine conflict resolution and US-Europe relations. Markets are closely monitoring for any policy shifts that might affect defense spending, sanctions, or diplomatic stance. The dollar index (DXY) has been consolidating near 103.50 ahead of the meetings, with traders positioned cautiously. Any breakthrough in peace negotiations could strengthen risk appetite, potentially weakening the USD's safe-haven appeal against currencies like EUR and AUD. Conversely, escalation concerns or diplomatic tensions could drive flight-to-quality flows into the dollar. Key levels to watch include 103.80 resistance and 103.20 support on the DXY, with EUR/USD likely to react inversely to any dollar movements.