Pound extends slump to 20-month lows after May delays Brexit deal

Reuters
UK pound coins plunge into water in this illustration picture, October 26, 2017. REUTERS/Dado Ruvic/Illustration

LONDON (Reuters) - Sterling <GBP=D3> tumbled on Monday to 20-month lows versus the dollar as investors took fright as Prime Minister Theresa May's decision to abandon a parliamentary vote on her Brexit deal.

The pound, down less than 1 percent before May outlined to lawmakers why she had postponed Tuesday's planned vote, fell as much as 1.6 percent to $1.2521 <GBP=D3>, its weakest since April 2017.

The British currency also sank versus the euro, down 1.5 percent at 90.875 pence <EURGBP=D3> and its lowest since late August.

The domestically focussed FTSE 250 index <.FTMC> fell 1.5 percent to the lowest since December 2016 and ten-year British government bond yields fell 7.5 basis points to 1.19 percent, the lowest since mid-August <GB10YT=RR>.

May said on Monday she was delaying a planned vote in parliament on her Brexit deal as it was set to be rejected "by a significant margin".

(Reporting by Tommy Reggiori Wilkes and Helen Reid; Editing by Saikat Chatterjee)