Investing.com - The pound slid lower against the U.S. dollar on Tuesday, after Bank of England Governor Mark Carney said a hike in interest rates would be "limited and gradual".
GBP/USD hit 1.6979 during European morning trade, the pair's lowest since June 18; the pair subsequently consolidated at 1.6979, shedding 0.28%.
Cable was likely to find support at 1.6924, the low of June 18 and resistance at 1.7063, the high of June 19 and a five-year high.
In testimony before parliament’s Treasury committee, Carney said that the "exact timing" of a rate increase "will be driven by the data".
"The most important aspect of the guidance that we're giving is that our view is that the increases in rates over the forecast horizon, in our best estimation, will be limited and gradual," Carney said.
The pound had recently strengthened to five-year highs against the dollar amid expectations that the deepening economic recovery in the U.K. will prompt the BoE to raise interest rates sooner than other central banks.
Last Wednesday’s minutes of the central bank’s June meeting showed that policymakers were "somewhat surprised" that the financial markets were pricing in a low probability of interest rates rising this year.
BoE Governor Mark Carney said earlier this month that rates could rise sooner than investors expect. The remarks prompted investors to bring forward expectations for a rate hike to the end of this year from the first quarter of 2015.
Separately, industry data on Tuesday showed that U.K. mortgage approvals rose by £41,800 last month, beating expectations for an increase of £41,300, after a downwardly revised gain of £41,900 in April.
Sterling was lower against the euro, with EUR/GBP gaining 0.39% to 0.8021.
In the euro zone, data showed that the German Ifo business climate index fell to a six-month low of 109.7 this month from 110.4 in May and compared to estimates of 110.3.
Later in the day, the U.S. was to release private sector data on consumer confidence, as well as a report on new home sales.