* Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh
* Markets waiting for Powell's speech at Jackson Hole
* Fed reluctant to embark on easing cycle - Fed minutes
* Futures show rate cut expectations remain high
* Brexit confusion undermines sterling (Adds new low for Chinese yuan)
By Stanley White
TOKYO, Aug 22 (Reuters) - China's yuan fell to an 11-year low against the dollar on Thursday due to worries about an economic slowdown, prompting Chinese state-owned banks to support the currency in the forwards market.
The yuan's fall, combined with declines in Hong Kong stocks on concerns about protests in the city, pushed the antipodean dollars lower and boosted the yen against major crosses in so-called risk-off trades.
Other currencies were locked in tight ranges ahead of U.S. Federal Reserve Chairman Jerome Powell's speech at Jackson Hole on Friday, which will be closely scrutinised after an inversion in the Treasury yield curve highlighted the risk of a U.S. recession.
Expectations for additional rate cuts are high, and U.S. President Donald Trump's vocal calls for aggressive monetary easing could put the Fed in a bind.
"Some investors like commodity trading advisors have linked the downward move in the yuan and Chinese stocks to selling cross yen," said Yukio Ishizuki, foreign exchange strategist at Daiwa Securities in Tokyo.
"The bigger concern is what Powell says tomorrow. He doesn't want to give away too much, but there is already a sense that Trump is doing a lot to decide monetary policy."
At the Fed's last meeting in July, the U.S. central bank cut interest rates for the first time in a decade to 2.00-2.25%. The Fed next meets Sept. 17-18.
In onshore trading, the yuan CNY=CFXS fell to 7.0752 per dollar, its weakest since March 2008, before recovering slightly to 7.0732. In offshore trade the dollar CNH= rose 0.29% to 7.0872 yuan.
Major Chinese state-owned banks were seen supporting the yuan by receiving dollar/yuan swaps, traders told Reuters. International Monetary Fund on Wednesday warned governments against trying to weaken their currencies through monetary easing or market intervention. could place unwanted attention on the yuan after the U.S. Treasury declared China a currency manipulator in an escalation of the U.S.-China trade war.
China is also in the spotlight as a series of protests in Hong Kong calling for greater democratic freedoms have become the biggest challenge to Chinese rule of the city since it reverted from British colonial rule in 1997.
The dollar held steady at 106.43 yen JPY=EBS following a 0.36% gain on Wednesday, its biggest since Aug. 13.
Against the Swiss franc CHF=EBS , the dollar traded at 0.9828, close to a two-week high of 0.9831.
The Australian dollar AUD=D3 fell 0.32% to $0.6761 and declined 0.47% to 71.95 yen AUDJPY= .
The New Zealand dollar NZD= skidded to $0.6372, the lowest since January 2016, and slumped 0.66% to 67.84 yen NZDJPY= .
Minutes from the Fed's last meeting released on Wednesday showed policymakers were deeply divided over whether to cut interest rates but were united in wanting to signal they were not on a preset path to more cuts. 10-year Treasury yields US10YT=RJR gained after the minutes, but interest rate futures are pricing in a 100% probability of a Fed rate cut at its September meeting, a 75% chance of an additional cut in October, and a 48% likelihood of another cut in December, the CME's FedWatch tool shows.
The Fed and other central banks are cutting interest rates to contain a global economic slowdown caused by a prolonged trade war between the United States and China.
"Yields are supportive of the dollar for now, but this may not last after Powell's speech," said Junichi Ishikawa, senior foreign exchange strategist at IG Securities in Tokyo.
"Additional rate cuts are thoroughly priced in. If Powell sounds slightly hawkish, stocks could sell off, which would hurt the dollar against safe-haven currencies like the yen."
Sterling traded a tad lower at 91.46 pence per euro EURGBP= , on course for its second day of losses, as uncertainty about Britain's divorce from the European Union weighed on the pound.
Against the greenback, sterling GBP=D3 was little changed at $1.2127.
French President Emmanuel Macron said on Wednesday there would be no renegotiation of the terms for Britain's exit from the EU. British Prime Minister Boris Johnson is due to meet Macron in Paris on Thursday.