Investing.com - The pound held on to modest gains against the dollar on Tuesday after Bank of England Governor Mark Carney said the 7% unemployment target is a threshold and not a trigger for rising interest rates. GBP/USD was up 0.15% to 1.6179 during European late morning trade, from 1.6132 on Monday. Cable was likely to find support at 1.6100 and resistance at 1.6239, Monday’s high. Carney welcomed the fall in the U.K. unemployment rate to 7.6% in the third quarter, but reiterated that the bank’s 7% target for unemployment was a threshold at which the bank would consider raising interest rates. The comments came during testimony on the BoE’s quarterly inflation report before parliament’s Treasury committee. Carney defended the bank’s forward guidance on rates, saying it gives market participants a view of the conditions that the bank needs to see before considering rate hikes. Sterling was almost unchanged against the euro, with EUR/GBP edging up 0.05% to 0.8372. The euro shrugged off dovish remarks by European Central Bank board member Benoit Coeure, who said Tuesday that negative deposit rates are still a possibility. Investors were turning their attention to preliminary euro zone inflation data, due out on Friday, amid expectations that the annual rate of inflation would rise to 0.8% in November, from October’s four year low of 0.7%. The slowdown in euro zone inflation last month prompted the ECB to cut interest rates to a record low 0.25% at its November meeting.

Source