FOREX-Euro falls, set to post worst quarter ever; dollar best since 2008

* Euro set for almost 11 pct quarterly fall vs dollar

* Greece worries drive euro down 1 pct on day

* Dollar on track for biggest quarterly gain since 2008

* Upbeat U.S. consumer, housing data support greenback (Adds updated prices; changes dateline, previous LONDON)

By Richard Leong

NEW YORK, March 31 (Reuters) – The euro fell to a 10-day low against the dollar on Tuesday, putting it on track for its worst-ever quarter, as investors renewed bets the U.S. Federal Reserve would raise rates later this year while the European Central Bank moves to boost the euro zone economy.

The euro has fallen 11 percent against the dollar in the first quarter of 2015, driven by the ECB’s launch of a 1.1-trillion-euro bond purchase program in a bid to avert deflation spreading across the euro zone.

The euro has faced added selling pressure as Greece and its lenders have failed to strike a deal on reforms.

“If we’re looking at what’s the next trigger point for another move lower for the euro, I think it will be Greece,” said Ian Stannard, head of European FX strategy at Morgan Stanley in London.

Meanwhile, the dollar index, which gauges the greenback against a basket of currencies, has risen 9 percent since January and is poised for the strongest quarter since the third quarter of 2008.

“It’s hard to bet against the U.S. currency right now as the fundamental backdrop augurs for higher U.S. interest rates,” said Joe Manimbo, senior market analyst at Western Union Business Solutions in Washington.

The greenback got a further boost on Tuesday from month-end rebalancing flows and upbeat readings on U.S. consumer confidence and home prices, traders said.

The dollar index was up 0.4 percent at 98.41, just below a 12-year high set earlier in March.

The greenback was little changed against the yen, leaving its gain for the quarter at about 0.5 percent.

The euro was last down 0.9 percent against the dollar at $ 1.0739, which was above the 12-year trough of $ 1.0456 set on March 16, according to Reuters data.

The single currency was down 0.8 percent at 128.92 yen , bringing its quarter-to-date loss to 11.2 percent.

Analysts said the euro/dollar pair would depend more on U.S. data, specifically non-farm payrolls numbers due on Friday .

Signs of further improving in the U.S. jobs market will likely reinforce the view the Fed would end its near zero interest rate policy later this year, propelling the dollar and U.S. yields higher, they said.

(Additional reporting by Jemima Kelly in London; editing by Catherine Evans, Larry King and G Crosse)

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