The pound fell sharply in morning trading as the dollar recovered some of the strength it lost at the end of last week.
Having hit post-Brexit vote highs during trading last week, the pound was down 0.7 per cent against the dollar in mid-morning trading today, at $1.4065.
Sterling wasn't the only currency falling against the dollar: the euro was down 0.2 per cent, at $1.2401, while the yen was down 0.1 per cent at $0.0092.
Last week the pound rose as high as $1.43 on dollar weakness, after traders took comments by Steve Mnuchin to heart.
During a session at the World Economic Forum in Davos, the US Treasury secretary said a weak dollar was "good" for the US.
"The dollar remains the story here and the dollar index is currently hunkering down on the 89 handle having firmed a little in Asia overnight," said Neil Wilson, senior market analyst at ETX Capital.
"The conundrum of rising US yields and a falling dollar remains in place but with dollar shorts getting crowded traders should be wary of a squeeze."