Sterling crashed to 2-1/2 year lows against the yen on Tuesday and fell towards the $1.21 mark versus the dollar as the growing likelihood of a disorderly Brexit led investors to hedge or cut their exposure to British assets.

The selloff shows little sign of abating, with options implying more pain in store — three-month implied volatility, a contract that expires just before the Oct. 31 Brexit deadline jumped to over 11 vols, the highest since before March 29, the original date for Britain to leave the European Union.

Sterling traded as high as $1.32 in early-May, having fallen steadily since then, with losses accelerating since July 24 when new Prime Minister Boris Johnson took over as prime minister with the explicit agenda of taking Britain out of the EU, whether or not transitional trading agreements are in place.

The likelihood of that outcome, potentially catastrophic for the British economy, was seen to have increased as Johnson appointed a cabinet packed with Brexit proponents. That, alongside his tough line with the EU, has dashed prospects of a last-minute deal.

The British currency has shed around 2.4% of its value since Johnson took over.

Analysts say market players are rushing to reduce sterling exposure, having until recently seen no-deal Brexit as unlikely.

“(A no-deal Brexit) is a thing that has caught the market off guard,” said Simon Derrick, chief currency strategist at BNY Mellon. “There’s plenty of space for sterling to suffer because when sterling moves it tends to move very sharply.”

The currency plumbed a low of $1.2120 in Asian trading and is now down 0.4% on the day around $1.2166 GBP=D3 while against the euro is it at the lowest since Sept 2017 around 91.55 pence EURGBP=D3

It lurched some 0.7% lower against the Japanese yen to the lowest since Nov. 2016, falling past the key 132.28 yen level plumbed during January’s ‘flash crash’ episode. Having hit a low of 131.59 it stands now around 132.30 GBPJPY=

Adding to concerns is the possibility of a snap election which could well see Johnson strengthen his position — weekend opinion polls showed him with a significant lead over the opposition Labour Party.

The current parliament is resolutely opposed to no-deal Brexit but an election that provides Johnson with a big majority would allow him to overcome that obstacle.