The pound dropped against the euro after a survey from a leading UK business lobby revealed that the UK's manufacturing sector performed even worse than market commentators had been forecasting in August Manufacturing orders fell to their lowest level since October 2003, according to the latest poll by the Confederation of British Industry, with 42 pct of firms reporting total order books below normal and only 13 pct reporting them above normal The ensuing negative balance of -29 pct compares with -20 pct in July and expectations of a modest recovery to -16 pct At 11.46 am, the euro was trading at 0.6806 stg, up from 0.6798 just before the data were released. Against the dollar, the pound was slightly up at 1.7944 usd from 1.7938 previously, though analysts attributed this to the fact that the pound had been falling ahead of the release "Were it not for the fact that sterling had been weakening ahead of the release, the market impact of this disappointment may have been more pronounced," said CALYON currency analyst Daragh Maher The weak survey is likely to rekindle the debate about a possible further rate cut by the Bank of England later this year after the quarter point cut to 4.50 pct earlier this month, he said "The problem for the market and the Bank of England is that the data needs to become upbeat in order to justify the Bank's optimism on growth and the associated expectation that further monetary easing will not be required this year," Maher said Market players had recently begun to scale back their rate cut expectations in the wake of a more upbeat quarterly inflation report from the BoE, the minutes to the latest Monetary Policy Committee meeting revealing only a very tight vote to cut rates, and some recent firm economic data