The US dollar retreated Thursday, with the euro rallying, on raised hopes of an end to the Ukraine-Russia war after U.S. President Donald Trump held talks with the leaders of both of the involved countries.

At 04:25 ET (09:25 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, traded 0.2% lower to 107.590, sliding to its lowest since Feb. at 107.49, after rising as high as 108.52 in the previous session.

Dollar retreats on Ukraine peace hopes 

President Trump said late Wednesday that he had spoken with Russian President Vladimir Putin and Ukrainian President Volodymyr Zelenskiy about ending the ongoing conflict in Ukraine, saying both men had expressed a desire to reach a peace deal in separate phone calls.

The Kremlin added that Trump and Putin had agreed to meet, while Trump said the two would "probably" speak face-to-face soon in Saudi Arabia.

Meanwhile, China has raised a proposal to hold a summit between Trump and Putin aimed at ending the war in Ukraine, which is now approaching its third anniversary, according to a report in the Wall Street Journal citing people familiar with the matter.

This boost in sentiment has weighed on the safe-haven dollar, which had received a boost earlier Wednesday from the upside surprise in U.S. consumer prices for January, with both headline and core figures topping estimates. 

The Russian ruble soared against the dollar, with USD/RUB falling 3.6% to 90.600.

“On a normal day in FX markets, yesterday’s much-higher-than-expected U.S. inflation print should have left the dollar stronger across the board and risk assets under pressure,” said analysts at ING, in a note. “That was the case for a few hours before the headlines hit that Trump had had a 90-minute call with Putin to discuss an end to the fighting in Ukraine.”