The pound euro (GBP/EUR) exchange rate is falling sharply, dropping to a 6 week low.
The pound has tumbled despite surging Gilts, suggesting that the market is worried about the perilous fiscal outlook for the UK.
UK construction PMI also slowed to a six-month low, falling to 53.3 in December from 55.2 in November.
The euro is rising despite weak German data. German factory orders slumped -5.4% MoM as a recovery in the sector still looks a long way off.
German retail sales were also weaker than forecast falling -0.6% MoM, below the 0.5% rise forecast.
Elsewhere, Eurozone economic sentiment fell to its lowest level in over a year.