* Euro hits 7-1/2-month low

* Fed, ECB, BoE, BOJ among central banks to meet this

week

* Focus on inflation, growth outlook as Middle East war

drags on

* RBA expected to hike rates

By Rae Wee

SINGAPORE, March 16 (Reuters) - The dollar held near a

10-month high on Monday in a tentative start to the week, as

investors braced for a slew of central bank meetings under the

shadow of the U.S.-Israel war on Iran.

At least eight central banks, including the U.S. Federal

Reserve, the European Central Bank, the Bank of England and the

Bank of Japan meet this week to set rates, in their first policy

meetings since the Middle East conflict began.

Focus will be on policymakers' assessment of the impact of

higher oil prices on inflation and growth.

"The war ... poses downside risk to economic growth and

upside risks to inflation, so central bank responses will very

much depend on the recent context, specifically whether

inflation has been above, on, or below target," said Carol Kong,

a currency strategist at Commonwealth Bank of Australia.

Ahead of the meetings, the dollar retraced some of last

week's strong gains, leaving the euro bouncing slightly

from a 7-1/2-month low hit earlier in the session to trade 0.14%

higher at $1.1433.

Sterling was up 0.17% at $1.3245, though was not far

from the 3-1/2-month low it hit on Friday as it clocked a 1.5%

weekly decline.

The dollar index eased slightly to 100.20, but

remained perched near last week's 10-month high.

U.S. President Donald Trump said on Sunday he is demanding

that other countries help protect the Strait of Hormuz, adding

that Washington is in talks with several nations about policing

the critical shipping lane for oil and gas.

He warned in a separate interview with the Financial Times

that NATO faces a "very bad" future if U.S. allies fail to

assist in opening up the Strait.

The prospect of easing global energy disruptions sent oil

prices down slightly, but markets remained in disarray with

geopolitical tensions still running high and uncertainty over

when the war, now in its third week, could end.

"As things stand now, the likelihood we will really see a

change in current trajectory for central banks and their

monetary policies around the world is, in our view, very, very

limited," said Jorry Noeddekaer, head of global emerging markets

and Asia at Polar Capital, whose base case is for the war to be

relatively short-lived.

RBA TO HIKE, BOJ IN DIFFICULT SPOT

The Australian dollar was up 0.55% at $0.7019, buoyed

by hawkish rate expectations at home as the Reserve Bank of

Australia is seen tightening policy on Tuesday.

Markets are now pricing in a 74% chance that the RBA could

deliver a 25-basis-point hike.

"We are now pencilling two more hikes, one this week and

another in May," said CBA's Kong.

"In Australia, inflation was already too high even before

the Middle East conflict started, so with the new energy price

shock, that will further increase risks to inflation."

The yen meanwhile languished near the 160-per-dollar

level and last stood at 159.44.

The Japanese currency has come under pressure due to the

nation's heavy reliance on the Middle East for energy supplies,

with the war also throwing into question the BOJ's rate outlook.

"For Japan, the key risk is not simply higher oil prices,

but a deterioration in terms of trade driven by the costs of

imported energy and logistics, compounded by yen weakness and

constrained monetary policy flexibility," said Amova Asset

Management's chief global strategist, Naomi Fink.

"Markets - especially foreign exchange - may be

underestimating the probability of these pressures forcing a

more difficult policy trade-off for the Bank of Japan."

Elsewhere, the New Zealand dollar was up 0.47% at

$0.5803, while the offshore yuan strengthened slightly to

6.9002 per dollar.

Top U.S. and Chinese economic officials held "remarkably

stable" talks in Paris on Sunday that touched on potential areas

of agreement in agriculture, critical minerals and managed trade

for Trump and Chinese President Xi Jinping to consider in

Beijing, sources said.