* Kiwi the big mover after jobs data fuel rate cut bets
* Dollar treads water ahead of Fed meeting
* Sterling edges higher on Brexit optimism
* Graphic: World FX rates in 2019 tmsnrt.rs/2egbfVh
By Tommy Wilkes
LONDON, May 1 (Reuters) - The New Zealand dollar fell on Wednesday after weak jobs data added to expectations for an interest rate cut as investors worldwide waited for news from Federal Reserve Chairman Jerome Powell at the end of a two-day policy meeting.
Trading was thin with large parts of Asia and Europe off on holiday, and most currency pairs were trading within tight ranges.
The Fed meeting comes after a run of strong U.S. economic data last month sent the dollar surging to a two-year high.
"The risk for this Fed meeting is that, unless the FOMC meets the market’s dovish expectation for their stance, we would expect another leg higher in USD," Mizuho strategists said in a note.
The dollar, measured against a basket of currencies, was little changed at 97.460.
The euro inched higher against the dollar, hitting $1.1224 . Strong economic growth data out of the euro zone on Tuesday had pushed it higher and prompted some short covering from hedge funds who have been betting big against the single currency in recent weeks.
The big mover of the day was the New Zealand dollar, which fell half a percent after government data showed employment unexpectedly fell in the March quarter, even as the jobless rate eased a tick to 4.2 percent.
Markets responded by further cutting the odds on a rate cut from the Reserve Bank of New Zealand, which has already stated that the next move was likely to be down. The RBNZ holds its policy meeting next week.
The kiwi was 0.4 percent lower at $0.6649 at 0720 GMT.
"The RBNZ appears to be ahead of other G10 central banks in shifting to a more dovish policy stance, and this adjustment should continue to keep the kiwi under downward pressure in the near-term," MUFG analysts wrote.
The Australian dollar was little moved by the weakness in its neighbour, trading at $0.70525.
Sterling extended its run this week to hit a new two-week high, supported by growing optimism that the ruling Conservative and opposition Labour parties can break the Brexit deadlock in their negotiations over how to leave the European Union.
The pound rose 0.1 percent to $1.3058, leaving it up 1.6 percent so far this week.
The Japanese yen fell marginally to 111.50 yen per dollar in quiet trading. Japanese markets are closed for a series of holidays. (Editing by Andrew Heavens)