Sterling fell half a percent to a 1-1/2 week low on Friday as a resurgent dollar and comments by U.S. President Donald Trump that a possible trade deal was probably dead sapped demand for the British currency.
In early London trading, sterling fell to $1.3131, its lowest since July. 3.
Trump, who is visiting Britain, said Prime Minister Theresa May's newly-announced Brexit blueprint had probably killed hopes of a U.S.-UK trade deal.
Markets are also concerned that the European Union will demand more concessions from Britain before agreeing to a Brexit deal, spelling months of more political uncertainty.
Against the euro, the British currency weakened a quarter of a percent to 88.56 cents.