GLOBAL MARKETS-Shares steady, pound treads cautiously ahead of BoE meeting

(Updates throughout; refreshes prices at 0900 GMT) By Amanda Cooper LONDON, June 20 (Reuters) - Global shares held around record highs on Thursday, supported by investor confidence in the prospect of a drop in U.S. interest rates this year, which also boosted gold, while the pound held steady ahead of a Bank of England meeting later in the day. The Swiss National Bank cut interest rates for a second time this year, which knocked the Swiss franc EURCHF=EBS CHF=EBS , while Norway's Norges Bank left rates unchanged, as expected. Next up is the BoE, which is also expected to leave UK interest rates unchanged, but may offer a steer on what to expect later this year. The MSCI All-World index .MIWD00000PUS was broadly steady at 805.19, having marked another record high on Wednesday, when U.S. markets were closed for a public holiday. In Europe, the STOXX 600 .STOXX rose 0.4% in early trading, lifted by positive sentiment around the tech sector. In currencies, the pound GBP=D3 was steady at $1.27125 in cautious trading but is down 0.2% in June. FRX/ Data on Wednesday showed British inflation returned to the central bank's 2% target for the first time in nearly three years in May, but strong underlying price pressures all but rule out an interest rate cut ahead of next month's election. Most economists in a Reuters poll last week thought the central bank would start to cut rates in August. But markets see only a 30% chance of an August rate cut and think a first move is more likely in September or November. Futures markets show traders have priced in 43 basis points of easing from the BoE this year. 0#BOEWATCH "High and persistent service inflation has been a persistent vex for the BoE and expect to hear about it during their press conference today," Caxton strategist David Stritch said. "We still feel that this is a bank that wanted to cut six months ago and fully expect an implication of a cut in August, with the door open for more to come after," he said. The euro EURGBP=D3 , which hit its lowest against the pound in nearly two years last week, was last down 0.1% at 84.36 pence. The single European currency was also down 0.1% against the dollar at $1.0717. In Asia, the onshore yuan CNY=CFXS weakened past 7.26 per dollar for the first time since November after the Chinese central bank left its key benchmark lending rates unchanged despite recent data showing the economy remains wobbly. The dollar index =USD , which measures the U.S. currency against six others, was little changed at 105.27. Gold XAU= , which tends to perform well in an environment of lower rates, was up 0.3% at $2,333 an ounce, having touched its highest since the start of June earlier on. A surge in tech stocks on Tuesday lifted AI chipmaker Nvidia NVDA.O above Microsoft MSFT.O as the world's most valuable company, leading to a global rally in tech shares. With U.S. markets closed for a holiday on Wednesday, stock futures were in the green on Thursday, with those on the tech-heavy Nasdaq 100 NQc1 outperforming, up 0.7% compared with a 0.4% rise in S&P 500 futures ESc1 . "Nvidia remains the most important stock in the world," Chris Weston, head of research at Pepperstone, said in a note. Weston though cautioned that index market breadth has been poor, with participation underwhelming, suggesting the rally has been built on a shaky foundation. "The fact remains the market is now all in on the rally in AI-related names and big tech and given the lack of clear immediate risk the path of least resistance is for higher equity index levels." On a macro level, investors are looking for fresh cues as to when the Federal Reserve would start its policy easing cycle after the central bank last week projected just one rate cut in the year and policymakers this week have also been cautious. The Japanese yen JPY=EBS reached its weakest level against the dollar since late April on Thursday, reaching 158.44. Much of the decline in the value of the currency has been the product of the wide gap between Japanese and U.S. interest rates. In commodities, oil prices rose, with Brent LCOc1 up 0.4% at $85.38 a barrel, while U.S. crude CLc2 for August delivery was up 0.15% at $80.83. O/R <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ World FX rates YTD http://tmsnrt.rs/2egbfVh Asian stock markets https://tmsnrt.rs/2zpUAr4 ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Reporting by Ankur Banerjee, additional reporting by Summer Zhen in Hong Kong; Editing by Miral Fahmy) (([email protected];; Mobile - +65 8121 3925; Follow on X (formerly Twitter): @AnkurBanerjee17;)) ((To read Reuters Markets and Finance news, click on https://www.reuters.com/finance/markets For the state of play of Asian stock markets please click on: 0#.INDEXA ))