The pound has made gains on currency markets after Britain's Prime Minister Boris Johnson lost his majority in the House of Commons.
Tory MP Phillip Lee's defection to the Liberal Democrats lifted sterling.
Earlier, the pound had touched its lowest level since October 2016 before recovering to erase the day's losses.
Rebel Tories and Labour MPs want to pass a bill to stop the UK leaving the EU on October 31 without a deal.
No 10 has threatened a snap general election on October 14 if MPs succeed in seizing control of Commons business.
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