"Even on an optimistic basis the UK labour market is not going to deliver an unemployment rate at 7 percent for six to twelve months at the very earliest, while inflationary pressures are under control"
- David Tinsley, economist at BNP Paribas
As it was widely expected Britain's policymakers refrained from any additional stimulus measures, sticking to Carney's pledge to keep borrowing costs at current level for the foreseeable future even despite obvious signs the economy is gaining momentum. The Bank of England under Mark Carney's leadership left the key interest rate at record low of 0.5%, while the volume of asset purchase programme also remained unchanged at 375 billion pounds. As always the bank did not provide any details, hence markets will have to wait until October 23, when MPC minutes will be released.
Most reports over the recent month have suggested that nation's stalled improvement is getting back in gear at last, as the U.K. is now one of the fastest growing developed economies in the world. Furthermore, latest data forced the IMF to upgrade its growth outlook, seeing expansion of 1.4% this year, and an acceleration to 1.9% over the next twelve months. However, economic output still remains below the pre-crisis levels, meaning it has plenty of scope to develop without generating any additional inflation pressures. This fact supports Carney's decision not to raise interest rates before the jobless rate reached 7%.
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