LONDON, Sept 13 - Sterling was steady on Thursday, holding within a percent of this week's seven-month highs against the dollar, with markets transfixed on events abroad.
Dealers said trading volumes remained thin in the wake of Tuesday's devastating plane attacks on the United States although some calm had been restored after world central banks on Wednesday said they would act to ease any market volatility. Tuesday's attacks had triggered safe-haven flows into European currencies, including the pound.
"Sterling is very quiet this morning in line with other major currencies," said Michael Klawitter, senior foreign exchange strategist at West LB in London. "As long as the U.S. equity market is closed, trading in all foreign exchange markets will be very thin." U.S. stock markets are closed until Friday at the least.
At 0715 GMT, sterling stood around $1.4665 , barely changed from late New York levels and compared with highs around $1.4775 set a day earlier. Against the euro, the pound stood steady around 61.80 pence .
Bank of England Governor Sir Edward George said on Wednesday major world economies would have the scope to respond to any economic problems that may result from the attack on the United States but coordinated interest rate cuts were very unlikely.
British retail sales data were due out at 0830 GMT, but expected to take a back seat to international events. Economists polled by expect a 0.4 percent rise in August sales compared with an increase of 0.6 percent the month before.
Some focus was also seen falling on the results of the opposition Conservative Party's leadership contest, due later. The announcement was due on Tuesday but was delayed as a sign of respect to the vistims of the U.S. attacks. Conservative Party leader William Haugue resigned in June after being resoundingly defeated in parliamentary elections by the ruling Labour Party. Markets were also awaiting the European Central Bank's interest rate desision at 1145 GMT. Chartists said sterling could hold a tight range against the euro in the near term. "The euro is sidelined very near term between 61.30 and 62.10 pence," said Karen Jones, technical analyst at Commerzbank in London. "The market continues to find very good interim support at 61.55/30 and remains bid while contained here."