* Euro recovers early losses vs dollar, Mideast demand seen
* Fed QE to keep dollar under selling pressure
* Periphery concerns may cap euro gains (Updates throughout, adds comment; previous TOKYO)
By Naomi Tajitsu
LONDON, Nov 10 (Reuters) - The euro rose against the dollar on Wednesday, boosted by Middle East buying, while key technical support helped curb selling of the single currency, seen in the past few days.
The euro recovered from a three-day losing streak versus the dollar, as investors speculated more quantitative easing by the Federal Reserve will continue to sting the U.S. currency as the European Central Bank sticks to its current monetary policy.
Analysts said the dollar's bounce since late last week would be short-lived and the euro would continue its uptrend, after it hit its highest in nine months versus the dollar last week. "Despite the correction we've been seeing, the euro's bull trend is still in place," said John Hydeskov, senior currency analyst at Danske 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."
By 0917 GMT, the euro rose 0.2 percent on the day to $1.3808, with traders citing solid buying by Mideast names as helping pull the single currency back from a slide to around $1.3732.
That was roughly a low hit in late October, and technical analysts said it was offering support to the single currency.
The dollar was little changed versus a currency basket, while it slipped slightly against the yen to 81.66 yen, retreating from the day's high around 81.90 yen.
Traders cited dollar buying by Japanese names, but also said sell-orders from Japanese exporters around 82.00 yen was helping block a rise in the dollar beyond that level.
Sterling was little changed at $1.5980, as investors awaited the Bank of England's quarterly inflation report later in the day for clues as to whether the UK central bank will embark on more quantitative easing.
Markets are still betting the central bank may eventually expand its 200 billion pound ($320 billion) asset purchase programme, although recent firm data has reduced expectations of such a move.
"Should the inflation report make it clear that quantitative easing remains an option for the BoE that would put pressure on sterling," Commerzbank analysts said in a note.
PERIPHERY CONCERNS
The dollar was unable to sustain gains made in earlier trade, when a rise in long-dated U.S. Treasury yields helped spur some demand for U.S. assets. The 30-year Treasury yield hovered near a five-month high hit on Tuesday.
The euro's gains were limited, however, by investors' focus on debt problems facing some euro zone countries, including Ireland and Portugal. The gap between benchmark Irish and German yield spreads expanded to its widest ever level on Wednesday.
A near-term risk for the euro is a Portuguese government bond auction later on Wednesday.
Portugal, seen by markets as a possible candidate for a Greek-style bailout, is scheduled to sell up to 1.25 billion euros ($1.72 billion) of government debt.
Tuesday's move by a Chinese credit rating agency to cut the sovereign rating it assigns the United States underscored growing tension between Beijing and Washington over economic policy ahead of a Group of 20 leaders' summit on Thursday and Friday in Seoul. (Additional reporting by Tokyo Forex team; Editing by Catherine Evans)