* Dollar edges lower before FOMC; rate cut expected

* Yen pares gains from peaks on BOJ rate cut talk

* Firm European shares weigh on dollar, yen

* China cuts benchmark interest rates, effective Thursday

(Adds quotes, updates prices)

By Tamawa Kadoya

LONDON, Oct 29 (Reuters) - The dollar fell against other major currencies on Wednesday, as markets expected the U.S. Federal Reserve to deliver a substantial interest rate cut later in the day and as share prices gained in Europe and Asia.

The yen also lost ground on talk that Japan's central bank may jump on the monetary easing bandwagon even though it already has rock-bottom interest rates.