* Dollar steadies on uncertainty before FOMC next week
* UK GDP, S&P lifts pound; Swedish crown falls on Riksbank
* Dlr/yen up; Japan finmin: to take steps on FX if needed
(Updates prices)
By Jessica Mortimer
LONDON, Oct 26 (Reuters) - The dollar steadied on Tuesday, with investors wary of pushing it lower due to some uncertainty about what easing measures the Federal Reserve may take next week, while UK economic growth figures lifted sterling.
The Swedish crown was the other significant mover, falling sharply after the central bank raised interest rates as expected but said future rate hikes would be more gradual than previously expected. [ID:nLDE69P0NR]
The market expects the U.S. Fed to opt for more quantitative easing (QE) next week, but some easing is seen priced into an already weak dollar. How much QE the Fed decides on and how gradually it will implement is uncertain, keeping investors edgy about building more bearish bets on the dollar.
It rose against the yen, edging away from 15-year lows after Japan's finance minister Yoshihiko Noda warned the government would "act decisively" in currency markets if needed. [ID:nTOE69O09F]
His comments pushed the greenback back above 81 yen, with traders citing buying from Japanese life insurers and banks, among others, on the view that Japan may intervene if the dollar nears 80.00 yen.
"Japan has pointed out quite clearly that they will intervene in dollar/yen if it falls too quickly and the market is aware there is no easy one-way bet on dollar/yen downside," said Stephan Maier, currency strategist at Unicredit in Milan.
"Everything is dependent on the FOMC (U.S. Federal Open Market Committee) and people don't want to take aggressive positions ahead of this very big decision," he said.
At 1120 GMT, the dollar was up 0.47 percent at 81.14 yen
Against a basket of currencies <.DXY> the dollar was up 0.26 percent at 77.313. It has support around 76.00-10, just below its Oct. 15 low of 76.144 while resistance is seen at 78.40.
The euro fell 0.26 percent to $1.3926
"The dollar is in a bit of a holding pattern. The market is still mulling over the U.S. QE story and dollar selling is a bit less of a one-way bet than it was," said Jeremy Stretch, currency strategist at CIBC.
For a PDF on the G20's uneasy truce on currencies
and trade imbalances: http://r.reuters.com/nan99p
For an FX column on the Fed: [ID:nLDE69L1EY]
For a Q&A on Japan intervention: [ID:nLDE69P0KT]
Overnight, New York Fed President William Dudley said the Fed could provide "essential" support to the U.S. economy, although it was uncertain whether an incremental or big bang approach to asset purchases was better.
However, his colleague Kansas City Fed President Thomas Hoenig warned more easing would be a "dangerous gamble". [ID:nN25295144]
STERLING JUMPS, SWEDISH CROWN FALLS
Sterling was a clear outperformer, rising 1 percent against
the dollar
Growth still slowed from the second quarter but the data bolstered the pound as investors saw less chance that the Bank of England would announce more monetary stimulus next month. Sterling extended gains after S&P rating agency raised its outlook on the UK to stable from negative. [ID:nWLA6239]
The Swedish crown fell broadly meanwhile, with the euro
rising more than 1 percent to 9.2830 crowns
Analysts said the 25 basis point hike in interest rates had already been priced into the crown, while the surprise news of a slower tightening path tempered investors' recent bullish view on the currency.
"The market had been pricing in a hike, and now the Riksbank has suggested there is not the case for such strong hikes next year, which has clearly pushed euro/Swedish crown higher," Unicredit's Maier said. (Editing by Susan Fenton)