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UK rates held until unemployment falls

Tuesday, August 06, 2013 - 02:00

August 7 - Bank of England governor, Mark Carney, talks on holding interest rates at a record low of 0.5% to aid the recovery of Britain's economy. (Rough Cut) no reporter narration.

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ROUGH CUT - NO REPORTER NARRATION The Bank of England plans to keep interest rates at a record low until unemployment falls to 7 percent or below, something unlikely for another three years. Barely a month after Canadian Mark Carney took over as governor, the central bank said it would keep interest rates at 0.5 percent unless inflation threatened to get out of control or there was a danger to financial stability. Carney said a recovery in Britain's fragile economy was underway and it appeared to be broadening but he warned that it had a long way to go before it was on solid ground. The Bank of England followed the U.S. Federal Reserve's approach by setting an unemployment target rather than committing to keeping rates low for a set period of time but included get-out clauses. BoE policymakers said they stood ready to buy more government bonds if additional stimulus was needed and would not reverse existing purchases while unemployment was too high. The central bank said inflation was forecast to stay above its 2 percent target until the second half of 2015 based on market rate expectations.

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UK rates held until unemployment falls

Tuesday, August 06, 2013 - 02:00