* Euro slides, dragged lower by losses vs rallying sterling
* Pound climbs, BoE says inflation to rise in near term
* Euro also weighed by Portugal bond auction
(Releads, updates throughout)
By Naomi Tajitsu
LONDON, Nov 10 (Reuters) - The euro slipped against the dollar on Wednesday, dragged lower by its losses versus sterling, which rallied after the Bank of England said inflation pressures would pick up further in the near term.
The dollar rose broadly, hitting a one-month high against the yen. It sailed higher after stop-loss orders were triggered, pushing the U.S. currency above the 82.00 yen level.
Sterling struck a six-week high versus the euro EURGBP=D4 after the BoE's inflation report said near-term price risks would pick up further. Investors took that as a sign that more UK quantitative easing may be unlikely for now. [ID:nBOE004375]
However, it added that CPI would be around 1.6 percent in two years, lower than its 2 percent target. The BoE added that it was ready to act in either way on monetary policy.
"The euro move is being driven by euro/sterling selling following the slightly hawkish BoE inflation report," a currency trader in London said.
By 1118 GMT, the euro EUR= had slipped slightly on the day to $1.3760, edging closer to the day's low around $1.3732 that was hit in earlier trade. Support is seen at that level, last touched in late October.
Some traders said an auction of Portuguese government bonds, where were issued at a much higher cost to the nation than at a previous auction, was also weighing on the euro. [ID:nLIS002504]
The euro's losses helped to prod the dollar slightly higher versus a currency basket .DXY, while it climbed to around 82.20 yen, its highest since Nov. 12.
Sterling GBP=D4 climbed 0.6 percent on the day to $1.6090.
The euro has retreated from a 9 1/2-month high touched last week versus the dollar as concerns have resurfaced about debt problems facing euro zone countries, Ireland and Portugal.
The gap between benchmark Irish and German yield spreads expanded to its widest ever level on Wednesday.
Borrowing costs in Ireland have breached record highs this week as the country plans to push through hefty spending cuts and tax hikes in an effort to convince investors it is not on the verge of financial meltdown. [ID:nLDE6A3168]
But the euro's pace of losses has slowed somewhat as some investors speculate that more quantitative easing by the Federal Reserve will weigh on the U.S. currency. The European Central Bank meanwhile, is sticking to its current monetary policy. "Despite the correction we've been seeing, the euro's bull trend is still in place," said John Hydeskov, senior currency analyst at Danske Bank in Copenhagen.
"With the Fed pumping $600 billion into the economy and the ECB sticking to its current policy (under which monetary easing is unlikely), we're going to continue to see a divergence in policy."
China's central bank on Wednesday increased reserve requirements for its biggest banks, fuelling expectations that Beijing may step up monetary tightening to cool asset markets and curb inflation risks. [ID:nBJA002338]
The move comes as tensions between Beijing and Washington simmer over economic policy ahead of a Group of 20 leaders' summit on Thursday and Friday in Seoul.
Few investors expect any significant agreement on currencies or trade imbalances to emerge from the meet. A G20 official told Reuters the communique would call for "flexible exchange rate movement", and would not provide neither numerical targets nor details on external imbalances. [ID:nASN000037] (Editing by Sujata Rao)