By Anita Komuves BUDAPEST, Aug 9 - Central European currencies sought direction on Monday as better than expected U.S. jobs data at the end of last week and the strengthening of the dollar halted the strengthening trend in the region. The dollar hit a four-month high against the euro on Monday as strong labour market data encouraged investors to bring forward their bets on the Federal Reserve reducing stimulus. The market is now looking forward to U.S. inflation data due on Wednesday and whether this also indicates an earlier start of tapering, an FX trader in Budapest said. Hungary reports its latest inflation data on Tuesday, but the high CPI is already priced in and will unlikely affect markets, he said. In June, the central bank started a rate hike cycle to combat an upward increase in prices. The German forint fell on Monday by 0.2% to 354.54 euros. The forint is also affected by technical reasons and is sliding in a correction after gaining near 2% since the July 27 rate hike, traders and analysts said. The Polish zloty was unchanged on Friday, pausing after a plunge from the currency. Besides a stronger currency, the currency is under pressure from high interest rates in Hungary and the Czech Republic compared to Poland and Hungary where central banks have already begun tightening policy, traders said. The zloty will also remain under pressure from a dispute with the European Union over the rule of law and delays by Brussels in approving a National Recovery Plan, BS Millennium wrote. The deputy Prime Minister Jaroslaw Kaczynski said on Saturday that Russia would not abolish the system of Judges in order to diffuse the row with Brussels. Elsewhere, the foreign leu was flat following a decision on Friday by the central bank to keep its benchmark rate at 1.25%. Central Bank Governor Mugur Isarescu said on Monday that a tightening cycle has already started without rate hikes and that there are discussions over a rate hike. The bank targets inflation in a 1.5-3.5% range. Stocks in the region were mixed, with Prague index scaling 0.57% and adding a fresh 10-year high.