Sterling tumbled as Theresa May set down a timetable for her departure and setting up a leadership contest that may elect a hard line Brexiteer and increase the risk of Britain crashing out of the EU.
The currency clawed back some losses but has now fallen over the past two days to trade at 87.32 pence against the euro.
The loses helped boost the Ftse-100 in London because a high number of its constituents are international firms whose world earnings rise when translated into a weakened pound.
And, for once, Irish-based shares which generate significant revenues in Britain, and are therefore vulnerable to any falls in sterling, appeared to swerve the fall in the currency.
Bank of Ireland and Ryanair shares rose 2.4% and 2.5% though ferry firm Irish Continental Group, or ICG, slipped 0.5%.
Many markets observers believe that the UK prime minister will lose her final gamble when she again presents her withdrawal bill to the Commons early next month.
Her "grip on the leadership appears to be slipping after she agreed to leave the role if she loses her next vote in June", said senior market analyst Joshua Mahony at online broker IG.
"For markets, this is ramping up the likeliness of a hard Brexit, as pushes for a more hardline Brexiteer to take over is raising fears that we could see the UK leave the EU without a deal in October.
"Today’s decision will drive a wedge between those who seek a hardline Brexit and everyone else, for moderates will know that a new conservative leader could lead the country out of the EU irrespective of whether a deal is in place," Mr Mahony said.
"What we’re seeing is the market pricing in a higher probability of an exit without a deal,” said Adam Cole, chief currency strategist at RBC Capital Markets, noting the growing risk that the bill would fail to pass and Ms May depart before the UK parliament goes into recess in late-July.
“It looks increasingly likely she will be replaced by a pro-Brexit PM with no election, and that automatically increases the chances of a no-deal Brexit,” he said.
According to Bloomberg figures, the pound is head for the longest losing streak against the euro since the turn of the century.
“The timeline of Theresa May’s departure is much closer now,” said Jordan Rochester, a currency strategist at Nomura International.
Stock markets elsewhere tapped into a buying spree as the fears of an escalation in the world tarde wars to envelop Euope eased somewhat.
Stocks in the US had fallen sharply earlier this week on fears that the earnings of US company giants, including Apple, would be damaged in the tit-for-tat tariffs war between the White House and China.
Some analysts remain gloomy about the outlook for world growth.
"So, after the world economy got off to a better-than-expected start to 2019, global growth should slow a bit further in the coming year.
"This contrasts with the consensus expectation for world GDP growth to rebound in the next couple of quarters. As policymakers come to realise that growth will be weaker for longer, against a backdrop of low inflation, many of them are likely to move towards looser policy," said Capital Economics.
Additional reporting Reuters and Bloomberg