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LONDON, June 23 Reuters Sterling trimmed some of its declines versus the euro and the dollar on Thursday after betterthanexpected UK PMI numbers for June, but the pound remained vulnerable to political risks and recession fears.

The PMI39;s preliminary composite index held at 53.1 in June, above the median forecast of 52.6 in a Reuters poll of economists, and unchanged from May. 

The pound was down 0.5 against a strengthening U.S. dollar at 1.2208, having earlier fallen below 1.22.

Against the euro, sterling edged 0.1 on the day at 85.98 pence, having earlier touched a oneweek low. .

Markets are likely reading the UK survey results in comparison with the euro zone ones, which instead showed a larger drop than expected, said Francesco Pesole, FX strategist at ING.

This may partly and temporarily ease some market concerns about the UK economic outlook, supporting the current aggressive Bank of England rate pricing, and ultimately helping euroGBP move back below 86.00, he said.

The BoE raised its benchmark rate by 25 bps to 1.25 on June 16 and said it was ready to act forcefully if needed to stamp out dangers posed by inflation, despite fears that the rising cost of borrowing could further harm the economy.

Investors were also on watch for further signs of political instability as the ruling…