Pound Higher Amid BoE Carney's Testimony

The pound was higher against its major opponents in the European session on Tuesday, after the Bank of England Governor Mark Carney announced his support for the Brexit deal unveiled by U.K. Prime Minister Theresa May last week.

"We have emphasized from the start the importance of having some transition between the current arrangements and the ultimate arrangements," Carney told the Treasury Select Committee.

Carney declared his support for the transition arrangements in the withdrawal agreement and the possibility of extending that transition period.

Carney added that the withdrawal agreement would "support economic outcomes" by preventing uncertainty of a no-deal Brexit.

"No-deal Brexit is an unlikely scenario," he told lawmakers.

Meanwhile, European stocks fell as global growth worries persisted and investors watched the latest developments on Brexit after U.K. Prime Minister won support from Britain's top business group for her draft Brexit deal.

Traders also remained skeptical about the outcome of a meeting between U.S. President Donald Trump and Chinese President Xi Jinping at the G20 summit in Argentina later this month.

The currency fell against its major counterparts in the Asian session amid risk aversion.

The pound climbed to 0.8875 versus the euro, from a low of 0.8922 touched at 2:10 am ET. The pound is likely to challenge resistance around the 0.87 level.

Figures from the Federal Statistical Office showed that Germany's industrial producer prices rose at the fastest pace in 18 months during October.

Producer prices rose 3.3 percent year-on-year following a 3.2 percent increase in September. The increase matched economists' expectations.

Reversing from an early low of 1.2823 against the greenback, the pound advanced to 1.2883. The pound is seen finding resistance around the 1.30 mark.

Having dropped to near a 3-week low of 144.07 against the yen at 4:10 am ET, the pound changed direction and appreciated to 144.91. On the upside, 146.00 is possibly seen as the next resistance level for the pound.

The pound edged up to 1.2789 against the Swiss franc, following near a 2-month low of 1.2727 seen at 4:10 am ET. The next possible resistance for the pound is seen around the 1.29 mark.

Looking ahead, U.S. housing starts and building permits for October are due in the New York session.