* Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh
* Graphic: Trade-weighted sterling since Brexit vote http://tmsnrt.rs/2hwV9Hv
By Olga Cotaga
LONDON, Sept 23 (Reuters) - Sterling held steady on Monday
as investors awaited the British Supreme Court decision on
whether Prime Minister Boris Johnson misled Queen Elizabeth over
proroguing parliament, as well as whether Johnson will be able
to find some compromise over Brexit at the United Nations
General Assembly in New York.
Expectations that some progress in Brexit negotiations will
be made at the United Nations were low, however, leaving little
room for dissapointment for pound traders in case it does turn
out that Johnson fails to gain some ground from European
leaders, analysts said.
"We are sceptical of much in the way of progress being made
and on top of that there is also the risk of PM Johnson having
to cut his trip short to return to London if the Supreme Court
decision goes against the government," said MUFG analysts in a
note to clients.
Johnson suspended - or prorogued - the British parliament
for five weeks until Oct. 14, which Scotland’s highest court of
appeal ruled unlawful. But Johnson appealed the Scottish
decision to the Supreme Court, which is expected to announce its
decision early this week, analysts said.
If the Supreme Court were to rule against the government, it
would increase political uncertainty in the country and "weigh
on sterling a little," said Jeremy Stretch, head of G10 forex
strategy at CIBC.
The collapse of British travel firm Thomas Cook will
also likely put some pressure on the British currency as it
highlighted the weakness of the British retail sector, Stretch
said, adding that he sees "a drift lower for cable
(pound/dollar) for now."
Sterling/dollar will likely trade around "$1.23 in the short
term," Stretch said.
The pound was down 0.3% in mid-morning London trading at
$1.2435, having dropped earlier to a six-day low of
$1.2424, mostly due to broad-based dollar strength.
The dollar index was up 0.2% at 98.74 after rising
earlier to 1 1/2 week high of 98.832.
Against the euro, the pound was flat at 88.265 pence
.
The British pound had pulled back from a two-month high and
fell on Friday after Irish Foreign Minister said that London and
the European Union were not yet close to a Brexit deal.
(By Olga Cotaga; Editing by Angus MacSwan)
