(New throughout, updates headline and first paragraph, adds

fresh analyst quote)

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Dollar on track for biggest H1 drop since early 1970s

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US Senate tries to pass spending bill

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China trade progress precedes July 9 tariff deadline

By Chibuike Oguh

NEW YORK, June 30 (Reuters) - The dollar languished

against the euro and Swiss franc on Monday as markets weighed

the prospect of a ballooning U.S. government deficit and the

potential for trade deals with major trading partners.

Senate Republicans will try to pass President Donald Trump's

sweeping tax-cut and spending bill, despite divisions within the

party about its expected $3.3 trillion hit to the nation's debt

pile.

The dollar was down 0.49% to 0.795 against the Swiss franc

. The euro was up 0.21% at $1.1746 against

the dollar. The greenback was set to finish the month 3.4% down

against the franc, while the euro was set to gain 3.4% against

the dollar.

"You have a weak dollar due to a potentially large increase

in our budget deficit, and you have continued uncertainty around

these tariff deals," said Eugene Epstein, head of structuring

for North America at Moneycorp in New Jersey.

Treasury Secretary Scott Bessent said that countries could

still face sharply higher tariffs on July 9 even if they are

negotiating in good faith, adding that any potential extensions

will be up to Trump.

The U.S. and China had resolved issues around shipments of

Chinese rare earth minerals and magnets to the United States,

further modifying a May deal in Geneva, Bessent had said last

week.

"We had this positive news from the EU for a little bit and

we had potential positive deals coming up, but then you had

Trump doing a temporary about-face on Friday on Canada and so

forth," Epstein said.

The dollar was down 0.28% to 144.24 against the Japanese yen

, on track to finish the month flat versus the Asian

currency.