LONDON, June 6 Reuters The pound softened versus the euro on Thursday ahead of a European Central Bank meeting and after data showed a fall in British businesses39; expectations for wage growth in the coming year.

The euro was last up 0.12 on sterling at 85.09 pence, though still at the weak end of its recent range, after May saw the British currency strengthen against most major peers, as hotterthanexpected services inflation caused markets to give up on expectations of a June Bank of England rate cut.

Versus the dollar, the pound was a touch softer down 0.07 on the day 1.2784, but close to Tuesday39;s two and a half month top of 1.2818.

The main British macro news of the day was the release of a Bank of England survey showing British businesses39; expectations for wage growth over the coming year fell sharply last month to 4.1 in May from 4.6 in April, while on a threemonth average basis, the measure fell to 4.5 from 4.8.

Both were the lowest since the current series started in May 2022, and may ease policymakers39; worries that it will be hard to keep inflation on target and make it easier for them to cut interest rates.

Market pricing currently reflects expectations of one or two 25 basis point Bank of England rate cuts this year, with the first most likely to come in September.

So far the British election, due 4 July has had fairly little effect on the pound, though the election was announced the same day as the hotterthan expected inflation data.

Polls are…