The Bank of England has promised to keep rates at their lowest level in its 300-year history until unemployment falls to 7 per cent, marking a shift in monetary policy in the world’s sixth-largest economy.
Mark Carney, the new governor, on Wednesday announced that the BoE had become the latest central bank to offer explicit forward guidance to markets and the public that monetary policy would remain loose until the economy returned to better health.
Mr Carney, one of central banking’s earliest and most vocal advocates of guidance, said the Monetary Policy Committee “intends” to keep interest rates at 0.5 per cent until the UK economy creates what is likely to amount to an additional 750,000 new jobs.