LONDON (Reuters) - Sterling pared gains against the dollar and euro on Monday, while bond futures gave up losses, after data showed activity in the UK's manufacturing sector slowed by more than expected in August.
The pound fell to $1.6627 after the data, from $1.6645 beforehand, still leaving it 0.2 percent up on the day.
The euro rose from a five-week low of 78.92 pence to trade at 79.03 pence.
The Markit/CIPS UK Manufacturing Purchasing Managers' Index (PMI) fell to 52.5 in August - its lowest level since June last year and below all forecasts in a Reuters poll - from July's downwardly revised 54.8.
Separate data showed signs of moderation in the housing sector, as British mortgage approvals fell slightly in July.
British government bond futures FLGcv1 pared some of their losses, gaining about five ticks to 113.47.
The FTSEurofirst 300 index of pan-European shares turned negative after the UK data to trade 0.1 percent lower at 1,372.49 points at 0834 GMT [.EU].
Reporting By Jemima Kelly, additional reporting by William Schomberg and Francesco Canepa; editing by Anirban Nag