UPDATE 1-Sterling consolidates above $1.38

* Graphic: World FX rates in 2020 tmsnrt.rs/2egbfVh

* Graphic: Trade-weighted sterling since Brexit vote tmsnrt.rs/2hwV9Hv (Updates prices, adds comment)

LONDON, Feb 11(Reuters) – Sterling held above the $1.38 mark hit earlier this week on Thursday in relatively quiet currency markets owing to a Chinese holiday and a sparse data calendar.

Optimism over the speed of Britain’s COVID-19 vaccination programme compared to other countries in Europe and expectations of a weaker dollar this year have boosted the pound to nearly 3-year highs against the dollar and its highest since May 2020 against the euro.

A rally above $1.38 this week has made sterling the best-performing G10 currency of 2021, up 1.1% against the dollar and nearly 2% against the euro.

A post-Brexit trade deal with the European Union, and Bank of England comments that British banks would need at least six months to prepare for interest rates going below zero, have also boosted the pound.

Since the bank met last week, markets have pushed their expectation of negative rates out to February 2022.

Speculators meanwhile increased their long positions on the pound in the week to last Tuesday, CFTC data shows.

By 1520 GMT, sterling was 0.14% lower against the dollar at $1.3815, having hit a high of $1.3865 the previous day.

Against the euro, it was 0.2% lower at 87.83 pence, off a May 2020 high of 87.38 hit at the end of last week.

“GBP outlook for coming weeks is constructive,” said Petr Krpata, ING’s chief EMEA currency and interest rates strategist.

Investors had their eye on economic data in Britain.

A housing market upswing cooled sharply in January as the country went back into coronavirus lockdown and a tax break for buyers neared its expiry, a survey showed.

House price growth slowed more than economists polled by Reuters expected, and prices in London fell for the first time since July, the Royal Institution of Chartered Surveyors said.

Despite the post-Brexit deal, some 49% of British companies that export goods have run into difficulties caused by the shift in trade terms with the EU since Jan. 1, according to a British Chambers of Commerce survey, while one in five services exporters reported problems.

“Despite the market’s relief that the UK and the EU managed to strike a trade deal in December, it is becoming obvious that Brexit is casting long shadows,” said Jane Foley, Rabobank’s head of FX strategy.

“Looking ahead we continue to see both political and economic hurdles for GBP and anticipate a fairly rocky ride in the coming months. While we retain our medium-term target of EUR/GBP 0.87, we see scope for pullbacks into the spring before this level is held.”

Reporting by Ritvik Carvalho; Editing by Kevin Liffey, Kirsten Donovan

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