Sterling rose to its highest since August 2009 against a trade-weighted basket of currencies on Tuesday, buoyed by its rise to a 20-month high against the euro.
Sterling's trade-weighted index rose to 83.3, beating its previous high of 83.2, according to Bank of England data.
The gains came as the euro fell to 81.435 pence, its weakest since August 2010, and as the pound hit its highest in nearly six months against the dollar of $1.6159.
The pound has benefited as investors seek alternatives to the common currency due to increasing worries about the euro zone economy, political uncertainty in the Netherlands and France and debt problems in Spain.
(Reporting by Jessica Mortimer)