Britain's FTSE at two-month peak as sterling falters

* FTSE 100 up 0.2 pct

* Softer sterling helps consumer pharma

* EasyJet (Frankfurt: A1JTC1 - news) falls on mixed update, price target cut

* CRH (EUREX: 558474.EX - news) declines after bid trumped (Adds closing prices)

By Kit Rees and Julien Ponthus

LONDON, Oct (Shenzhen: 000069.SZ - news) 6 (Reuters) - British shares edged higher on Friday and held to their highest level in two months as political uncertainties linked to Theresa's May's premiership pushed the pound lower, giving a boost to dollar-earning groups such as pharma stocks.

The FTSE 100 index closed 0.2 percent up at 7,522.87 points, with Britain's pound on track for its worst week in a year as the Prime Minister hit back at a plot to topple her, saying she would provide "calm leadership" to the country.

"The talk of a leadership plot against the Prime Minister is eroding the pound's value and propping up the FTSE 100," CMC (Shanghai: 600327.SS - news) Markets analyst David Madden wrote in a note to clients.

Last month sterling strength helped the FTSE 100 to post a slight decline for September, but the currency has since been losing steam and the index has posted its biggest one-week gain since December last year.

Health stocks, which source a sizeable chunk of their revenue from the United States, were among the biggest gainers. Heavyweights GlaxoSmithKline and AstraZeneca (Swiss: AZN.SW - news) rose by about 0.3 percent and 1 percent respectively.

British American Tobacco (Kuala Lumpur: 4162.KL - news) was up 1.6 percent and Imperial Brands (LSE: IMB.L - news) advanced by 0.2 percent.

Shares (Berlin: DI6.BE - news) in budget airline easyJet dropped by 1.6 percent, the biggest FTSE 100 faller, after a price target cut from broker Credit Suisse (IOB: 0QP5.IL - news) .

The airline also posted a mixed pre-close update, with analysts pointing to pricing pressures despite easyJet reporting a record summer and saying that it expects to reach the higher end of its profit range.

"Revenue trends are improving, but pricing remains under pressure," Liberum analysts said in a note.

Credit Suisse analysts saw some supportive factors, however.

"With Monarch's failure, Air Berlin (LSE: 0GPE.L - news) 's break-up, Alitalia (Stuttgart: 2278962.SG - news) 's administration and Ryanair capacity cuts, we expect this confluence of positives must help EZJ (easyJet) pricing," they said in a note.

Shares in building materials company CRH fell by 1.3 percent after its offer for U.S. Ash Grove Cement Co was surpassed.

(Reporting by Kit Rees and Julien Ponthus; Editing by Keith Weir and David Goodman)