BoE won’t rush to raise rates despite UK recovery

Bank of England policy makers will not rush to raise interest rates when unemployment falls to the key 7% level it is on the cusp of reaching.

Data yesterday showed the jobless rate fell more than economists forecast to 7.1% in the three mon-ths through November. That is close to the level that bank governor Mark Carney has set to consider increasing borrowing costs from a record low.

The monetary policy committee (MPC) “saw no immediate need to raise bank rate even if the 7% unemployment threshold were to be reached in the near future”, it said in the minutes of its Jan 8-9 meeting, published yesterday. Cost pressures were “subdued” and headwinds to growth “would persist for some time”, it said.