Pound treads water as dollar holds firm

LONDON, Oct 12 (Reuters) - The pound held steady against the dollar on Monday, ahead of public appearances by a number of Bank of England officials, while investor wariness over developments in the Middle East kept volatility in check.

The oil price reversed earlier losses and rose above $105 a barrel after attacks on Saudi Arabia and uncertainty over comments from US President Donald Trump over an energy ceasefire between Ukraine and Russia that surprised Ukrainian President Volodymyr Zelenskiy and on which Russia declined to comment.

US consumer price data due later in the week could help steer expectations for where US interest rates end the year, which, in turn, could affect expectations for other central banks, such as the BoE, that are also grappling with inflation stemming from the war in the Middle East.

The pound was last flat at $1.324, but strengthened against the euro , which fell 0.14% to a low of 84.49 pence, matching last week's 16-month trough, as concern mounted about the risk to the broader euro zone from the intense pressure on French bonds .

"Markets are yet to focus on the upcoming UK Budget, which in any event poses far smaller challenges than the French one. Accordingly, the pound was among the key beneficiaries from the widening in French spreads lately," Barclays strategists said in a note.

Sterling has been fairly range-bound for much of the past couple of weeks, hemmed in by uncertainty ahead of this month's UK budget, but also by the strength in the dollar.

Money markets show traders are attaching roughly a 90% chance of the BoE raising rates at its next meeting on November 5 and expect it to deliver a series of hikes during 2027 that would bring the base rate to 4.75% in a year's time, from 3.75% now. Economists polled by Reuters expect no change to UK interest rates until later in 2027, with the next shift likely to be a cut.

This week brings a raft of commentary from various BoE officials, culminating in Governor Andrew Bailey's appearance at the IMF and World Bank annual meetings in Bangkok this week.

Monetary Policy Committee members Sarah Breeden and Catherine Mann speak at different events later on Monday, while Megan Greene and chief economist Huw Pill speak later in the week.

On the political front, Prime Minister Andy Burnham will tell parliament on Monday that Britain must consider a new, closer relationship with the European Union, saying a new post-Brexit deal with the bloc could boost growth and help control immigration.