The U.S. dollar declined against its major counterparts in the European session on Monday, as investors focused on upcoming interest rate cut by the Federal Reserve, even as hopes for aggressive easing have faded following comments by officials from the central bank.

CME Group's FedWatch Tool currently indicates a 75.5 percent possibility for a 25 basis-point rate cut at its next meeting at the end of July.

The Wall Street Journal reported on Friday that Fed officials are likely to lower interest rates by a quarter-percentage point later this month and may pursue further cuts in the future given slowing global growth and trade uncertainty.

Hopes for larger rate cuts tempered after St. Louis Fed President James Bullard suggested that an aggressive easing measure was inappropriate in the current circumstances.

This came after the New York Fed President John Williams dismissed the likelihood of a large interest rate cut at the meeting later this month.

With today's economic calendar being light, traders await reports on new and existing home sales, durable goods orders and second quarter GDP due this week for more direction.

The currency traded mixed against its major counterparts in the Asian session. While it rose against the yen and the franc, it held steady against the pound and the euro.

The greenback was trading lower at 107.85 against the yen, down from a 5-day high of 108.07 set at 9:30 pm ET. If the greenback extends decline, 106.00 is possibly seen as its next support level.

The greenback depreciated to 0.9804 against the Swiss franc, its weakest level since July 1. On the downside, 0.96 is possibly seen as the next support level for the greenback.

Data from the Swiss National Bank showed that Switzerland's broad money supply grew the most since January 2018.

The broad money supply, M2, expanded 3.7 percent year-on-year in June, faster than the 3.4 percent increase seen in May. This was the fastest expansion since January 2018, when M3 climbed 3.9 percent.

The greenback edged down to 1.1225 against the euro, after rising to 1.1207 at 7:45 am ET. The greenback is seen facing support around the 1.135 level.

Germany's finance ministry warned that the weakness in the industrial sector and exports is set to last longer, mainly due to global risks such as the trade tensions.

"Leading indicators and falling orders indicate a persistently weakened industrial economy," the ministry said in its latest monthly report

The greenback eased to 0.6787 against the kiwi and 0.7057 against the aussie, from its early 4-day highs of 0.6757 and 0.7031, respectively. The currency is likely to find support around 0.69 versus the kiwi and 0.72 against the aussie.

On the flip side, the greenback reached as high as 1.3096 versus the loonie, up from last week's closing value of 1.3059. Next key resistance for the greenback is likely seen around the 1.33 region.

The greenback held steady against the pound, after having advanced to a 4-day high of 1.2456 at 7:45 am ET. At Friday's close, the pair was worth 1.2498.

Survey data from IHS Markit showed that British households' expectations towards future finances remained positive in July.

The headline household finance index rose for the second straight month in July, to 44.3 from 43.9 in June. The score signaled the weakest level of pessimism among households towards their finances since January.

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