* Sterling steady vs dlr below $1.64; hits 1-week low vs yen * Investors trim risk positions on weak U.S. data, equities * Quiet day in UK; next week's BoE meeting eyed By Jessica Mortimer LONDON, Oct 28 (Reuters) - Sterling steadied against the dollar and fell sharply against the yen on Wednesday as weak U.S. confidence data and lower equities encouraged investors to trim positions in currencies perceived as higher risk. Lower appetite for risk kept sterling trading below the $1.64 level against the dollar, well under levels close to $1.67 reached last week, and pushed it to a one-week low against the yen. A survey on Tuesday showed UK retail sales rose more than expected this month, but analysts said investors were likely to remain cautious ahead of next week's Bank of England decision amid uncertainty over whether it will increase asset purchases. "Most of the focus for sterling is going to be on the BoE next week and up until then movements will largely reflect what's going on with currencies elsewhere," said Geraldine Concagh, economist at AIB Group Treasury in Dublin. "There has been a flight to the dollar after weak U.S. data and due to volatilities in the equity market and that has been reflected in cable (sterling/dollar)," she said. At 0850 GMT, sterling was steady against the dollar at $1.6380 GBP=D4, while the euro EURGBP=D4 was steady against the UK currency at 90.34 pence. Against a broadly firmer yen, sterling GBPJPY=R fell 1 percent to 149.35 yen, close to an earlier one-week low around 148.97 yen. U.S. data on Tuesday showing consumer confidence unexpectedly plunged in October helped trigger gains in the dollar and the yen. Sentiment was dented further by falling equities, with UK shares .FTSE falling more than 1 percent, while oil prices CLc1 were also lower. In the UK, attention is already turning toward the BoE's Monetary Policy Committee meeting next week and whether its 175 billion pound quantitative easing programme will be expanded. "The high degree of uncertainty going into the next week BoE meeting contains the risk of ongoing market nervousness and a higher volatility," KBC analysts said in a note. Under its QE programme, the Bank of England has since March been buying assets to inject liquidity into the economy, contributing to sterling weakness. Shock news last week that the UK economy contracted again in the third quarter prompted investors to reassess their previous expectations that quantitative easing may be paused in November and snapped a two-week rally in the pound. (Reporting by Jessica Mortimer, editing by Mike Peacock)

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