The Bank of England will announce at 12pm (London) if they are to maintain the current base rate of 0.50% and if they will adjust the current level of asset purchase of £375bn. The UK economic recovery is beginning to take hold, and there has been considerable speculation as to when the Lady of Threadneedle St. will raise base rates from their current record low.
KPMG/REC: UK Jobs Growth Strongest Since March 2010 < 7% threshold here we come...— Joe Bond (@Joe_Trading) January 9, 2014
Governor Mark Carney who began his role last summer used the policy of forward guidance to give the markets direction as to when tightening would occur. Carney explained that interest rates would remain at 0.5%, for the foreseeable future, with a threshold of a 7% unemployment level being the caveat for a change in policy. However the official unemployment rate is now 7.4% and rapidly approaching this 7% level, with speculation that Carney will lower the target unemployment rate to 6.5%.