Cable continued its recent push lower following remarks by the Prime Minister over the weekend which some market commentary took to mean the chances of a so-called 'hard' Brexit had increased.
During her first televised interview of 2017, on 8 January, Theresa May said the UK would be unable to maintain "bits" of its membership.
Commenting on May's remarks, Rabobank Senior FX Strategist Jane Foley told clients: "While yesterday's comments from PM May do not refer to a transitional period, they reassert the view that the government is preparing for a hard Brexit."
On Monday, the Prime Minister sought to clarify her position, but to little avail.
As of 1613 GMT cable was down by 1.18% to 1.2136, after having hit an intra-day low of 1.2124.
"I'm tempted to say that the people who are getting it wrong are those who print things saying I'm talking about a hard Brexit, it is absolutely inevitable there's a hard Brexit," May said.
"But we mustn't think of this as sort of leaving the EU and trying to keep bits of membership, what bits of membership will we keep."
"It's a new relationship, we'll be outside the EU, we will have a new relationship but I believe that can be a relationship which has a good trading deal at its heart."
May's remarks came a day before the Chancellor, Philip Hammond, was due to meet with his German counterpart, Wolfgang Schaeuble.
Hammond was also to attend a conference together with German Chancellor Angela Merkel.
"This week earnings reports from a variety of retailers may offer fresh perspective as to how price pressures could form in the coming months. UK trade data for November due in the middle of the week could offer an insight as to whether GBP
is having an impact of export volumes while production data is expected to follow the brighter path drawn by PMI surveys. Even if these data provide relief, we see GBP as remaining vulnerable to the UK political situation and favour selling GBP into rallies vs. the EUR with a medium-term target of 0.88," Foley said.
As of 1613 GMT, the US dollar
spot index was drifting lower by 0.16% to 102.06 and euro/GBP up by 1.11% at 0.8672.
In parallel, dollar/yen was down 0.49% to 116.43, although euro/dollar was little changed, drifting just 0.08% lower to 1.0525.
To take note, the results of an online poll conducted by ORB and published on Monday found that 46% of Britons believed increased control over immigration was of greater importance than access to free trade, with 39% of respondents holding the opposite view.
Another poll undertaken in November had shown that 43% would prioritise free trade, against 41% who believed immigration was the important issue of the two.
"This poll clearly shows that if the country had to choose it would prefer greater control over its borders to access to free trade," the managing director of ORB International, Johnny Heald, said.