Theresa May triggered the pound's biggest jump in eight years.
Sterling was hit by fears that Prime Minister Theresa May will say on Tuesday that Britain will lose its access to the EU single market.
The U.S. dollar gained against the yen and was little changed against the euro on Friday, rebounding from five-week lows.
There is little if any data to support suggestions that traders may have deliberately spurred October's flash crash in sterling, a BIS report said.
The dollar sank to a five-week low below 114 yen on Thursday and was on course for its worst week since November.
Mexico's peso weakened to a historic low of 22 per dollar on Wednesday, shortly after Donald Trump began a news conference in New York.
The dollar edged lower on Tuesday on nervousness ahead of U.S. President-elect Donald Trump's first news conference.
Talk of Britain dramatically reworking trade ties with the European Union after Brexit sent the pound tumbling to two-month lows.
The dollar rose on Friday, boosted by a US jobs report, but was headed for a second straight weekly loss after tumbling the day before.
Some of the biggest gains on record for China's yuan sent currency markets spinning.
Investors were cautious about increasing bets on the greenback before getting fresh clues on the U.S. economy.
Dealers and investors in London returned to push the greenback to within 1 percent of December's long-term highs.
The dollar recovered from a two-week low against a basket of six major currencies.
Weaker-than-expected economic data weighed on the greenback and waning risk appetite boosted Japan's safe-haven currency.
The U.S. dollar hit its highest level in two months against the sterling on Wednesday on concerns over next year's Brexit negotiations.
The dollar inched up against the yen on Wednesday after upbeat U.S. economic data reinforced expectations for economic growth.
The dollar headed into the Christmas break on Friday just over half a percent off highs hit after this month's Fed meeting.
The dollar dipped for a second day as traders booked profits ahead of a batch of U.S. data later in the day.
The dollar took a breather from its run since the November 8 U.S. presidential election.
The dollar was boosted by Fed comments that kept alive market expectations for a faster pace of U.S. interest rate hikes next year.