* Graphic: World FX rates in 2020 tmsnrt.rs/2egbfVh * Graphic: Trade-weighted sterling since Brexit vote tmsnrt.rs/2hwV9Hv LONDON, 28 June (Reuters) - Sterling rose on Monday as traders brace for the end of the worst month versus the dollar since September, with the focus moving to political risks this week. This month, sterling dropped for the first time since April below $1.38 against a strengthening dollar after the U.S. Federal Reserve surprised markets by signalling it would raise interest rates and end emergency bond-buying sooner than expected. Sterling was one of the worst performing G-10 currencies last week after the Bank of England kept the size of its stimulus programme unchanged and said inflation would surpass 3% as Britain’s economy reopens, but the climb further above its 2% target would only be temporary. But sterling rose 0.4% to $1.3926 versus the dollar at 0855 GMT. Against the euro, the pound rose 0.3% to 85.76 pence. “Historically the price action does tend to suggest a firm sterling into the end of month and quarter,” said Neil Jones, head of FX sales at Mizuho Bank. “My sense is seasonal end of month type sterling demand is in play given value date for spot is 30th June”. Currency strategists at ING said they expected politics to play a role this week, with investors watching a dispute between Britain and the European Union over post-Brexit trade in the British province of Northern Ireland. The current grace period waiving checks on British-made sausages and other chilled meats moving to Northern Ireland is due to end on June 30. Britain has yet to receive a formal response from the EU over its proposal to further extend the grace period, a minister said on Sunday. Britain is also digesting the resignation on Saturday of health minister Matt Hancock after he admitted breaking COVID-19 guidance with an affair. Britain’s new health minister, Sajid Javid, said his priority was to oversee a return to normal. Britain last week recorded the highest number of new coronavirus infections since early February. Daily positive cases have been rising for a month but a rapid vaccination programme appears to have weakened the link between infections and deaths, with daily fatalities remaining about 20 or lower. (Reporting by Joice Alves Editing by Robert Birsel) Our Standards: The Thomson Reuters Trust Principles.