* Dollar index little changed as markets await Fed review
* Kiwi weighed down by disappointing fall in dairy prices
* Sterling held hostage to "Brexit" sentiment
By Ian Chua
SYDNEY, March 16 (Reuters) - The dollar was in a holding pattern early on Wednesday as markets waited for fresh guidance from the Federal Reserve, while a disappointing fall in dairy prices knocked the New Zealand currency broadly lower.
The dollar index .DXY stood at 96.633, stuck in familiar territory since drifting off a one-month low of 95.938 set last Friday. The euro was little changed just above $1.1100 EUR= .
Against the yen, both the greenback and euro nursed losses. The dollar fetched 113.16 yen JPY= , while the euro bought 125.71 yen EURJPY=R following a fall of 0.5 percent on Tuesday.
The Bank of Japan on Tuesday skipped a chance to expand its massive asset buying programme even as it offered a bleaker view of the economy. Some traders said that combination cast a shadow on risk sentiment, which perversely bolstered demand for the safe-haven yen. the Fed, no policy action is expected but the market will be hyper-sensitive to any guidance on when it might deliver its next hike in interest rates.
Any signal that there is more than one hike in store this year will be positive for the greenback. Conversely, anything more dovish could keep the dollar pinned down.
"The FOMC is the main game over the next 24 hours," analysts at ANZ wrote in a note to clients.
"We retain the view that the next rate hike could come as early as June, and it would be reasonable to expect further increases in the second half of 2016. However, this outlook remains data dependent."
The two standout currencies overnight were sterling and the New Zealand dollar.
Sterling was back near $1.4150 GBP=D4 , having retreated from Friday's peak of $1.4437, driven by oscillating views on whether Britain would leave the European Union.
Taking the blame for the latest fall in the pound was a poll suggesting supporters of "Brexit" had overtaken those who wanted to stay in the EU. New Zealand, news of further price falls in the country's most valuable export dragged on the kiwi, which briefly dipped below 66 U.S. cents NZD=D4 for the first time in over two weeks. It was last at $0.6607.
International dairy prices fell at a fortnightly GlobalDairyTrade auction, confounding expectations for a rise and disappointing kiwi bulls. (Editing by Richard Pullin)