* Graphic: sterling and gilt yields bit.ly/2dgAXn1
* Graphic: World FX rates in 2016 tmsnrt.rs/2egbfVh
By Jamie McGeever
LONDON, Dec 22 Sterling fell to a two-week low
against the euro on Thursday after a survey of British consumers
showing a gloomy view of the economy's prospects next year kept
it on the defensive against a perky single currency.
It was sterling's fourth consecutive daily fall against the
euro, its longest losing streak since August, as it got caught
in the slipstream of the single currency's recovery from a
14-year low against the greenback this week.
Weakness against the euro also kept the pound anchored near
a one-month low against the dollar in quiet trading ahead of the
Christmas holiday period.
A big jump in households' appetite to make major purchases
helped market research company GfK's monthly consumer sentiment
index inch up to -7 in December from -8 in November, but this
concealed a deterioration in consumers' outlook for 2017.
Expectations for the year to come are now the weakest since
just after June's vote to leave the European Union, and before
that they were last lower in April 2013, when the economy had
suffered a period of sluggish growth.
"Both the economic and financial situation expected by
consumers over the next 12 months has deteriorated, and hints
that confidence will slide more clearly in the first half of
2017," JP Morgan economist Allan Monks said.
By 0900 GMT sterling was down 0.3 percent at 84.65 pence,
edging further away from five-month highs of 83.05 pence touched
The euro was higher against the dollar at $1.0450, up
a cent from Tuesday's 14-year low of $1.0350.
Sterling slipped 0.1 percent against the dollar to $1.2341
, drifting back towards Tuesday's one-month low of
Sterling has for the past six months been less sensitive
than usual to economic data, driven more by concerns over
Britain's departure from the EU. Any signs that a hard Brexit,
in which Britain loses access to the single market, is on the
cards have tended to drive down the currency, with signs to the
contrary giving it a boost.
(Editing by Louise Ireland)