* Graphic: World FX rates in 2020 http://tmsnrt.rs/2egbfVh
* Graphic: Trade-weighted sterling since Brexit vote http://tmsnrt.rs/2hwV9Hv
(Updates prices, adds comment)
By Elizabeth Howcroft
LONDON, Sept 17 (Reuters) - The pound held steady on
Thursday, little changed versus the dollar and slightly up
against the euro, as investors waited for the Bank of England's
policy meeting.
The Fed decided to keep interest rates on hold in the near
future, disappointing investors who had bet that the Fed might
unveil more policy easing.
The dollar saw its biggest daily rise in more than a week
and riskier currencies - including the pound - lost out. But the
dollar's gains subsided during the European session and the
pound returned to just below $1.30.
Attention is now focused on the Bank of England's monetary
policy meeting, the minutes of which will be published at 1100
GMT.
The bank is widely expected to hold fire on new policy
measures and send only a signal of its intent to do more in
future.
But the economic projections are likely to be bleak, as
Britain faces growing risks of a no-deal Brexit, rising COVID-19
cases and social restrictions, and the end to the government's
jobs support scheme.
"The economic reasons for holding the pound are becoming
less evident," said Peter Kinsella, global head of FX strategy
at UBP.
Although no changes to monetary policy are expected at
today's meeting, investors expect further quantitative easing in
November, and will be listening for hints about the possibility
of negative rates,
At 1041 GMT, the pound was at $1.297, little changed since
New York's close.
It was up around 0.2% against a weaker euro, at 90.06 pence
per euro.
Brexit talks were thrown into disarray by Prime Minister
Boris Johnson proposing legislation that would break
international law by breaching parts of the Withdrawal Agreement
relating to Northern Ireland.
The bill is moving through parliament this week. The pound
gained some respite on Wednesday after Johnson's government
reached a deal to avert a rebellion within his own party, by
giving parliament a say in the use of the post-Brexit powers
within the bill.
U.S. Democratic presidential candidate Joe Biden warned the
UK that it must honour its commitments to Northern Ireland, or
there would be no post-Brexit trade deal between the UK and
United States.
(Reporting by Elizabeth Howcroft, Editing by William Maclean)