LONDON, March 24 Reuters The euro fell sharply against a strengthening dollar on Friday amid nervousness over banks, with betterthan expected economic data failing to lift sentiment.

Flash Purchasing Managers39; Index PMI data failed to lift the single currency as sentiment in markets were fragile with European banks falling 5.3.

SP Global39;s flash Composite Purchasing Managers39; Index PMI, seen as a good gauge of overall economic health, bounced to a 10month high of 54.1 in March from February39;s 52.0, data showed on Friday.

That was well above the 50 mark separating growth from contraction and above all forecasts in a Reuters poll.

The euro had already plunged below the 1.08 support line before the composite euro zone PMI data were released this morning, said Jane Foley, Head of FX Strategy at Rabobank London.

The data were better than expected, but the mood in the market is risk aversion which is supporting another move back to the safe haven dollar, she added.

Fuelling concerns about the overall stability of Europe39;s banks, Deutsche Bank shares fell 14.

The euro sank 1 to 1.0722. The dollar index , which measures the currency against six major rivals, rose 0.6 at 103.26.

Risk aversion also sent sterling 0.6 lower to 1.2209, despite data showing the British economy was set to grow in the first quarter and confidence was growing.

The pound touched a sevenweek high of 1.2341 on Thursday in volatile trading after the Bank of England raised interest rates…