LONDON (AFX) - Sterling lost ground in midday trade on the weaker-than-expected Confederation of British Industry's quarterly industrial trends survey, while the euro was off its recent lows as investors scaled back their optimism about the US economy, dealers said. Dealers said the market had been expecting a negative CBI survey but the release showed the UK economic situation is weaker than thought. "The euro/dollar has come up a little bit, but it's mainly a sterling move at the moment," Halifax currency strategy head Steven Pearson said. "The pretty gloomy outlook from the CBI is weighing on sterling, although it's not that pronounced and we haven't broken any ranges," he said. Dealers said investors are reassessing their view of prospects for a US recovery, even if they are by no means confident the European Central Bank will cut rates at tomorrow's meeting of its governing council. They said the euro will probably resume its fall if the ECB keeps rates on hold. However, a cut is unlikely to boost the single European currency, he said. Dealers said investors will focus on the Beige book due out from the US this evening.