UPDATE 1-Sterling swings lower after disappointing UK retail sales data

(Corrects date in third paragraph to July 2 from July 5)

By Yumna Mohamed

LONDON, July 21 (Reuters) - Sterling fell to a day's low against the dollar and the euro on Thursday after data showed the sharpest monthly fall in British retail sales in six months in June.

Sales volumes fell 0.9 percent, more than the forecast 0.6 percent, after rising by an above-average 0.9 percent in May. Compared with a year earlier, sales growth slowed to 4.3 percent from 5.7 percent in May, versus forecasts of 5.0 percent.

Retailers reported no anecdotal evidence of the unexpected result of the June 23 referendum affecting sales during the five-week period which ended July 2, the Office for National Statistics said.

Sterling hit a low of $1.3157 after the data, down 0.2 percent on the day, having traded at $1.3210 beforehand. It recovered some of those losses to trade at $1.3190, still down 0.15 percent on the day.

The euro was up 0.4 percent at 83.80 pence, having traded at 83.36 pence beforehand. It (Other OTC: ITGL - news) was last trading at 83.50 pence, still up 0.2 percent on the day.

"Despite the ONS saying there is no discernible anecdotal referendum effect, given the weak number, it's not something you can rule out," said Chris Hare, economist at Investec (LSE: INVP.L - news) .

"We've seen a pretty sharp fall in some consumer confidence measures so that would point at least at the margin to some referendum effect."

Sterling had traded higher in early deals in Europe after Bank of England policymaker Kristin Forbes said it should not rush into a cut in interest rates. Noted hawk and policymaker Martin Weale also said this week he was unsure if he would back a rate cut at next month's meeting.

Mirroring that view, Forbes in an article in the Daily Telegraph said that until more hard data is available, it would be good to "keep calm and carry on".

The BoE said last week that most of the nine members of its Monetary Policy Committee expected to give the economy more help at their next meeting which ends on Aug. 4. But two of them seem to be in a wait and watch mode, giving the pound a fillip.

"The more hawkish members of the MPC (KOSDAQ: 050540.KQ - news) are coming out against their support for easing in August," said Hans Redeker, head of currency strategy at Morgan Stanley (Xetra: 885836 - news) .

"This could cause markets to limit how much easing they price in for August. We remain sellers of sterling/dollar on rebounds as our economists are expecting enough members to vote for easing."

On Wednesday, the pound got a boost from a BoE survey that showed no clear evidence of slowing activity after last month's Brexit vote. The survey reported signs that demand for credit was easing and there were lower expectations for investment spending, but it also said the majority of companies did not expect any near-term impact on capital spending.

Traders are now awaiting flash PMI surveys of company purchasing managers on Friday that will offer more insight on the immediate economic reaction to the vote. (Additional reporting by Anirban Nag; Editing by Andrew Heavens)