Resignation of two of UK Prime Minister's key ministers in one day - Brexit Secretary David Davis and foreign secretary Boris Johnson - affected the pound on Tuesday.
The British currency sank as deep as $1.3189 briefly before rebounding somewhat to $1.3254. It was last traded 0.2 percent lower at $1.3230.
Versus the euro, it touched a four-month weak point of 89.025 pence in the previous session, and last stood at 88.68. The dollar index jumped to 94.201 from a trough of 93.713.
The greenback also climbed to 111.16 yen, from a low of 110.30.
The euro pulled back to $1.1739, having slid from a three-week high of $1.1790 set overnight.
The Chinese yuan ticked up 0.1 percent in offshore trade to 6.6114 versus the greenback.
The Aussie edged 0.2 percent higher to $0.7479, continuing to recover from $0.7311 hit on Monday last week.
Turkey's lira added 0.8 percent to $4.6954 after dipping to as low as $4.7506 on Monday.