The UK pound has pushed even higher against the US dollar, hitting levels not seen since the start of the 1980s.
In Thursday trading, the pound climbed as high as $ 2.1117, before falling back slightly to $2.1081.
Many analysts are predicting that the dollar could weaken further amid fears about the strength of economic and corporate profit growth in the US.
One of the main factors affecting the currency is the difference between interest rates in the US and elsewhere.
Inflation fears
Interest rates have been cut in recent months in the US to help stoke economic growth.
In the UK by contrast they have been kept on hold because of fears about accelerating inflation.
Investors tend to buy assets in countries with higher interest rates, underpinning the strength of sterling.
This has been exacerbated by speculation that the US Federal Reserve may be about to cut rates for a third time in three months.
The pound-dollar rate was last at similar levels in September 1981.
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