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The pound dropped to the lowest level in over four months against the dollar as Prime Minister Theresa May came under renewed pressure to step down after her new Brexit plan was roundly rejected.

Sterling fell for a record 13th day against the euro, after many of May’s lawmakers and the opposition Labour Party vowed to vote against her proposals in Parliament next month. Still, there was no sign of panic in the options market, where sentiment on the pound is negative but well above levels that would signal traders are pricing in a no-deal Brexit scenario.

The pound is the worst performer among peers against both the dollar and euro this month, a turnaround from earlier in the year when it led gains. With May’s rivals jockeying to replace her, traders fear a replacement could take a more hardline stance on Brexit, increasing the chances of the U.K. crashing out of the European Union.

“May’s latest attempt to conjure up a viable compromise EU Withdrawal Bill went down like a lead balloon in her own party and didn’t get visible support from anyone else, merely adding to uncertainty,” said Kit Juckes, a strategist at Societe Generale SA. “Pound-dollar is going to go on trying to drag euro-dollar down.”

The pound declined 0.3% to $1.2664, after touching the lowest level since Jan. 4, to take losses this month to 2.8%. It fell 0.2% to 88.05 pence per euro, in the longest run of losses since the common currency was introduced.

May is facing pressure to abandon her Brexit proposal and quit within days, according to people familiar with the matter, after government officials said they were shocked the new offer had been so badly received.

“What could be viewed as best from a sentiment perspective and for the pound, would be for PM May to resign now and not waste the next two weeks on a deal that stands next to no chance of passing,” said Fritz Louw, a currency analyst at MUFG Bank Ltd. “We see scope for further pound declines from here over the short-term.”

--With assistance from Vassilis Karamanis.

To contact the reporter on this story: John Ainger in London at jainger@bloomberg.net

To contact the editors responsible for this story: Ven Ram at vram1@bloomberg.net, Neil Chatterjee, Scott Hamilton

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