Pound Falls Amid Risk Aversion

The British pound weakened against the other major currencies in the early European session on Tuesday amid risk aversion, as weakening global growth prospects continue to put pressure on commodity prices.

While copper, nickel and zinc prices slid to multi-year lows, crude prices rose in Asian deals after Saudi Arabia hinted at production cuts to preserve price stability in oil markets. The U.K.'s FTSE 100 index is currently down 0.67 percent or 41.97 points at 6,263, France's CAC 40 index is down 1.07 percent or 52.38 points at 4,836 and Germany's DAX is down 0.60 percent or 66.40 points at 11,025.

Traders await the Bank of England Governor Mark Carney's testimony due shortly. His comments may provide fresh clues about the nation's inflation and timing of the BOE liftoff.

In the Asian trading today, the pound held steady against its major rivals.

In the early European trading now, the pound fell to nearly a 3-week low of 185.33 against the yen and an 8-day low of 0.7039 against the euro, from early highs of 186.00 and 0.7015, respectively. If the pound extends its downtrend, it is likely to find support around 183.00 against the yen and 0.71 against the euro.

Against the Swiss franc, the pound dropped to a 1-week low of 1.5389 from an early high of 1.5438. The pound may test support near the 1.51 area.

The pound edged down to 1.5119 against the U.S. dollar, from an early high of 1.5156. On the downside, 1.50 is seen as the next support level for the pound.

Looking ahead, the German Ifo business climate index for November is slated for release shortly.

At 4:05 am ET, Reserve Bank of Australia Governor Glenn Stevens is expected to speak about issues in economic policy at the Australian Business Economists Annual Dinner in Sydney.

At 5:00 am ET, Bank of England Governor Mark Carney and other policymakers Andy Haldane, Gertjan Vlieghe and Kristin Forbes appear before British parliament's Treasury Committee in London.

Bank of France new chief Francois Villeroy de Galhau holds news conference on new 20-euro banknote in Paris at 5:30 am ET.

In the New York session, preliminary third quarter U.S. GDP data, U.S. S&P/Case-Shiller home price index for September, U.S. Richmond Fed manufacturing index for November and U.S. consumer confidence index for November are set to be announced.

At 3:30 pm ET, Bank of Canada Deputy Governor Lynn Patterson will give a presentation as part of the bank's regional outreach program at the University of Regina in Canada.