The pound briefly leaped to a two-week peak on Monday after media reported Theresa May has secured a number of concessions from Brussels, including a customs union with the bloc.
The British currency erased gains to be last up 0.1 percent at $1.2989 after Britain’s Telegraph newspaper reported crucial obstacles still remain in the Brexit negotiation process.
With less than half-year to go until the UK departs from the European Union divorce negotiations stall, a media report that an all-UK customs deal will be written into the agreement was enough to drive sterling to $1.3062, its top since Oct. 22.
The UK's government confirmed that 95 percent of the exit agreement was settled and talks were ongoing.
The dollar index .DXY, a popular measure of the greenback's strength versus a basket of major currencies, sank 0.1 percent to 96.459.