FOREX-Euro struggles near 11-year low as investors bet on ECB quantitative easing

* Euro struggles near 11-year trough vs USD

* Key event risk this week is ECB's policy review on Thursday

* U.S. markets shut on Monday for public holiday

By Jemima Kelly

LONDON, Jan 19 (Reuters) - The euro edged up against the dollar on Monday but was still close to an 11-year low as investors braced for the European Central Bank to take its boldest steps yet to combat deflation and revive the euro zone's moribund economy.

The Swiss National Bank removed one of the euro's few remaining pillars of support last Thursday when it stunned markets by abandoning the three-year-old cap on the Swiss franc against Europe's common currency.

The SNB's policy U-turn, which means it will no longer be buying billions of euros in order to limit the franc's strength, sparked speculation that it was acting in anticipation of the ECB launching a large-scale quantitative easing programme at its next policy meeting on Thursday.

The euro was trading at $1.1585, not far from a trough of $1.14595 hit on Friday.

"There could be scope for substantial downside this week (for the euro)," said Michael Sneyd, an FX strategist at BNP (Paris: FR0000131104 - news) Paribas in London.

"However, the expectations for the ECB are now quite consensus and the euro has already moved quite a long way ... so that's likely to make investors who don't have a bearish euro position on quite cautious."

Traders said there would be volatility at the end of this week ahead of Greece's snap election on Sunday which, with anti-bailout party Syriza leading in the polls, could further undermine the credibility of the 19-nation currency bloc.

On Monday, however, currency markets could be relatively slow with U.S. markets shut for a public holiday and little in the way of market-moving economic data due.

Caution ahead of Thursday's ECB meeting, as well as the aftershocks from the Swiss move last week and a slump in Chinese shares on Monday, made many investors wary of risk.

That supported the yen, with the dollar easing to as low as 116.925 against the yen on Monday before recovering a little to trade at 117.190, down 0.4 percent on the day.

The euro gained 0.7 percent on the day against the franc to trade near parity at 1.0005 francs, but it has still lost nearly 17 percent against the Swiss currency since the SNB abandoned its cap on the franc of 1.20 per euro.

Swiss Finance Minister Eveline Widmer-Schlumpf said on Sunday that she expects the franc to settle at around 1.10 per euro, a level she believes Swiss exporters should be able to withstand.

"Markets are still digesting the SNB shock and trying to assess what damage it has done. We are yet to see the full impact," said Kosuke Hanao, head of FX at HSBC in Tokyo.

"Some hedge funds, which were severely battered by the SNB's surprise move, are likely to have sold assets like the dollar against the yen to lock in profits and generate cash." (Additional reporting by Ian Chua in Sydney and Tomo Uetake in Tokyo; Editing by Susan Fenton)