Traders see just below 50% chance of ECB cutting rates Falling...

• Traders see just below 50% chance of ECB cutting rates
• Falling U.S. yields pare dollar's gain vs euro
• Swiss franc hits two-year high vs euro on safe-haven demand
• Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh

(Updates market action, changes dateline, previous LONDON)

The dollar and euro were little changed on Monday as traders wait for decisions from the U.S. Federal Reserve and the European Central Bank on how much and how fast they may reduce interest rates, beginning with the ECB on Thursday.

Traders see about a 46% probability European policy-makers will lower a key deposit rate by 10 basis points to -0.50 basis points to combat risk from global trade tensions and anemic regional inflation, based on local interest rates market. ECBWATCH

"Our base case for the ECB could see some small upside in (euro versus dollar) unless the Governing Council delivers a strongly dovish surprise," said Ned Rumpeltin, TD Securities' European head of FX strategy. "Overall, however, we think recent range should remain in place."

Rising chances of European interest rates sliding deeper into negative territory had pressured the euro lower against the dollar, and propelled the Swiss franc to a two-year peak against the single currency.

Meanwhile, the greenback has been bogged down by bets the Federal Reserve will likely cut U.S. interest rates for the first time in a decade to deal with the same issues as the ECB.

Data published late on Friday showed speculators dialed back their net bullish positions in the dollar against other G10 currencies to their lowest level in a year.

At 10:10 a.m. (1410 GMT), the euro EUR=EBS was marginally lower at $1.1215, rebounding from a session low of $1.1207.

The dollar moved lower in step with U.S. yields. The two-year Treasury yield US2YT=RR slipped to 1.801% early on Monday, which was below the Fed's current target range of 2.25%-2.50% USFOMC=ECI on short-term rates.

An index that tracks the greenback against a basket of currencies .DXY was fractionally higher at 97.201.

U.S. rates futures implied traders positioned for a 72% chance the U.S. central bank may lower its rate range by a quarter point at its July 30-31 policy meeting, down from 76% late on Friday, according to CME Group's FedWatch tool.

Rates futures signaled traders priced in nearly a 28% chance for a 50 basis-point cut next week, up from 24% on Friday.

Rates futures rallied last Thursday with perceived chances for a half-point rate cut soaring to 71% after a dovish speech by New York Fed President John Williams. Those bets abated after a Fed spokesman clarified that the remarks did not refer to "potential policy actions."

The Swiss franc EURCHF=EBS fell to 1.0999 franc per euro earlier on Monday, which was its strongest level against the common currency since July 2017.

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	Currency bid prices at 10:14AM (1414 GMT) 

 Description	  RIC		 Last		   U.S. Close  Pct Change	 YTD Pct	 High Bid	Low Bid 
											  Previous				   Change				  
											  Session											
 Euro/Dollar	  EUR=		$1.1213		$1.1220	 -0.06%		 -2.23%	  +1.1225	 +1.1207 
 Dollar/Yen	   JPY=		107.9400	   107.7000	+0.22%		 -2.10%	  +108.0600   +107.7100 
 Euro/Yen		 EURJPY=	 121.08		 120.86	  +0.18%		 -4.07%	  +121.1600   +120.8100 
 Dollar/Swiss	 CHF=		0.9814		 0.9816	  -0.02%		 +0.00%	  +0.9840	 +0.9804 
 Sterling/Dollar  GBP=		1.2471		 1.2500	  -0.23%		 -2.24%	  +1.2520	 +1.2456 
 Dollar/Canadian  CAD=		1.3104		 1.3060	  +0.34%		 -3.91%	  +1.3105	 +1.3041 
 Australian/Doll  AUD=		0.7038		 0.7042	  -0.06%		 -0.16%	  +0.7057	 +0.7032 
 ar																							  

 Euro/Swiss	   EURCHF=	 1.1007		 1.1014	  -0.06%		 -2.19%	  +1.1035	 +1.1000 
 Euro/Sterling	EURGBP=	 0.8991		 0.8971	  +0.22%		 +0.08%	  +0.9000	 +0.8963 
 NZ			   NZD=		0.6769		 0.6761	  +0.12%		 +0.77%	  +0.6786	 +0.6758 
 Dollar/Dollar																				   

 Dollar/Norway	NOK=		8.6039		 8.5717	  +0.38%		 -0.40%	  +8.6073	 +8.5686 
 Euro/Norway	  EURNOK=	 9.6488		 9.6180	  +0.32%		 -2.60%	  +9.6527	 +9.6129 
 Dollar/Sweden	SEK=		9.4119		 9.3774	  +0.25%		 +5.00%	  +9.4141	 +9.3825 
 Euro/Sweden	  EURSEK=	 10.5545		10.5279	 +0.25%		 +2.83%	  +10.5579	+10.5206 
	 
	 
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GRAPHIC-Net speculative U.S. dollar positioning	http//tmsnrt.rs/32FPnYI 

GRAPHIC-Bets on bold first rate-cut from the Fed http//tmsnrt.rs/2XTkkpn GRAPHIC-Bets on bold first rate-cut from the Fed interactive http//tmsnrt.rs/2Y3UHTf Swiss franc vs euro http//tmsnrt.rs/32LkdiS

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