GBP fell sharply on Wednesday on growing expectations that Prime Minister Theresa May will again fail to get her Brexit deal approved and could soon face a leadership challenge.
Sterling has weakened more than 1% this month as deadlocked cross-party talks expose deep political divisions over how, when and even if Brexit should take place.
May plans to put forward her thrice-rejected Brexit deal in the week beginning June 3, to try to secure an agreement before lawmakers go on summer holiday.
But Britain’s opposition Labour Party said it would not ratify the deal if a compromise agreement is not reached with the government.
Those comments fuelled speculation that May will soon be ousted and pressured the pound.
The currency fell more than 0.5% to $1.2827, its lowest since Feb 15, and dropped around 0.4% versus the euro to 1.1448.
Sterling has fallen for eight consecutive days against the dollar despite mostly solid economic data in Britain in recent months.