Sterling supported after BoE; U.S. jobs data eyed

* Sterling inches up, holds gains after BoE ups QE funds * Focus on U.S. jobs data at 1330 GMT * Annual UK input price inflation turns positive in October

LONDON Nov 6 (Reuters) - Sterling edged up versus the dollar on Friday, staying supported after the Bank of England raised its quantitative easing programme by less than many had forecast.

The pound traded close to a two-week high against a broadly weak dollar, though trade was thin as investors braced for closely-watched U.S. non-farm payrolls figures, the market's main event for the day, at 1330 GMT.

Thursday's 25 billion pound increase in the BoE's asset-buying plan was less than some forecasts for 50 billion pounds and broadly supported sterling, particularly as many in the market believe this top-up of the central bank's asset purchase programme will be the last.

"Clearly people are still trying to digest the news yesterday and to assess the implications for sterling of the end of QE," said David Woo, head of currency research at Barclays Capital.

"There is the question that if the Bank of England is buying fewer gilts, will that mean more foreign investors will be buying them?" he added.

By 1216 GMT, sterling GBP=D4 had edged up slightly to $1.6596, not far from $1.6637 hit on Thursday, its highest since Oct. 23.

Optimism that U.S. employment data may show a slowing pace of jobs losses stoked some risk appetite and helped prod the safe-haven U.S. currency lower.

The euro EURGBP=D4 was steady against the pound to 89.64 pence.

Sterling is poised to end the week little changed against the euro and up more than 1 percent against the dollar.

UK producer prices data also helped lend support to sterling. Annual input price inflation for UK manufacturers turned positive in October for the first time since February, driven by a rebound in crude oil prices. [ID:nL6706911]

With the BoE meeting over, analysts said the market would focus on the bank's quarterly inflation report next week, which they said would shed more light on the medium-term outlook for inflation, the key driver of the BoE's monetary policy.

Under its QE programme, the BoE has since March been buying assets to inject liquidity into the economy. This contributed to recent sterling weakness which saw the pound touch a five-month low against the dollar in October.

The pound is still well above its low for the year -- hit in January -- around $1.35.

"The market's interpretation of the BoE decision was that quantitative easing is nearing the end of the road, and that monetary policy has a degree of finality to it," said Jeremy Stretch, strategist at Rabobank in London, adding that this helped keep the UK currency bid.

However, the overall view that the British central bank will maintain economic stimulus and keep interest rates low perhaps for longer than other central banks is seen limiting further gains.

(Reporting by Jessica Mortimer and Naomi Tajitsu, editing by Nigel Stephenson)